Georgia closing costs for buyers, line by line

Where the numbers come from

Within three business days of applying for a mortgage, your lender must give you a Loan Estimate. It lists every closing cost the lender expects, split into charges the lender controls, services you can shop for, taxes and government fees, and prepaids. At least three business days before closing you receive the Closing Disclosure with the final figures. Compare the two line by line.

Closing costs fall into four groups: lender charges, title and attorney charges, government taxes and recording fees, and prepaid items. Only one group — the taxes — is set by Georgia law. The rest are priced by the lender, the closing attorney and the title insurer, which is why they vary and why you can compare them.

Lender charges

• Origination or underwriting fees — the lender's own charges.
• Discount points — optional; prepaid interest to lower your rate. See mortgage points and buydowns.
• Appraisal fee — often paid upfront when the appraisal is ordered.
• Credit report, flood certification, tax service — small third-party fees passed through by the lender.
• Upfront mortgage insurance or funding fees on FHA, VA and USDA loans — usually financed into the loan rather than paid in cash. Your lender quotes the amount.

Title and attorney charges

Georgia closings are conducted by a licensed attorney. The closing attorney's firm searches title, prepares or reviews the closing documents, collects and disburses the money, and records the deed and security deed. The attorney typically represents the lender, not you — you may hire your own. See closing attorneys in Georgia.

• Attorney or settlement fee — the firm's fee for conducting the closing.
• Title examination — searching county records for liens and defects.
• Lender's title insurance — required by your lender; protects the lender.
• Owner's title insurance — optional but strongly advised; protects you. See title insurance in Georgia.
• Survey — optional in many transactions; worth considering on larger or irregular lots.

Georgia taxes and recording fees

Intangible recording tax. Georgia charges $1.50 for every $500 of a long-term loan secured by real estate — effectively 0.3% of the loan amount — capped at $25,000. It is paid when the security deed is recorded and is customarily paid by the buyer. On a $300,000 loan it is $900; on a $400,000 loan it is $1,200.

Transfer tax. Georgia's real estate transfer tax is $1 per $1,000 of the sale price. It is customarily paid by the seller in Georgia, though like most costs it is negotiable. See Georgia transfer tax.

Recording fees are charged by the clerk of the superior court in the county to record the deed and security deed. The attorney collects them.

Prepaids and escrow

Prepaids are not fees — they are your own housing costs paid in advance. They often surprise buyers because they can be a sizable share of the total.

• Prepaid interest from the closing date to the end of the month. Closing near the end of a month makes this smaller; your first payment is then due about a month later.
• First year of homeowners insurance, paid to the insurer.
• Initial escrow deposit — a cushion of several months of property taxes and insurance so your escrow account can pay the bills when they come due.
• Prorated property taxes — Georgia property taxes are typically prorated between buyer and seller at closing based on the days each owns the home in the tax year.

A worked example

Here is a $400,000 purchase with a $360,000 loan. Only the tax lines are statute math; every other line is a placeholder for the quote on your Loan Estimate.

Lowering what you bring to closing

• Ask the seller for a closing-cost credit — seller concessions are common and loan programs cap how much can be credited.
• Compare more than one lender's Loan Estimate; lender charges vary the most.
• Look at builder incentives on new construction, which often cover closing costs when you use the builder's preferred lender.
• Check down payment assistance — some programs also help with closing costs.

Common questions

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