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Closing Cost Estimator

Get an itemized closing cost estimate for any DSCR loan — by state — including transfer taxes, lender fees, title, and third-party costs for purchases and refinances.

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Closing cost estimator

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Itemized estimate

Estimated total closing costs

$8,365

Texas · purchase

CategoryItemAmount
Lender feesOrigination (1%)$3,500
Lender feesProcessing fee$695
Lender feesUnderwriting fee$995
Third-partyAppraisal$675
Third-partyCredit report$75
Third-partyLender's title insurance$1,600
Third-partyRecording fee$175
Third-partyEscrow/settlement$650
Transfer taxNo transfer tax in this state—
Lender total$5,190
Third-party total$3,175
Grand total$8,365

Estimates only. Actual closing costs vary by lender, title company, county, and deal structure. Transfer tax rates vary by municipality. This tool uses approximate statewide figures. Always review your Loan Estimate for exact costs.

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What are closing costs on a DSCR loan?

Closing costs are the fees and expenses paid at loan settlement — everything beyond the down payment. They fall into three categories: lender fees (charged by the mortgage company), third-party fees (appraisal, title, recording), and taxes (transfer tax charged by the state or local government at purchase).

For DSCR investment property loans, total closing costs typically run 2–3% of the loan amount on a purchase and 1.5–2.5% on a refinance. On a $400,000 loan, that's $8,000–$12,000 out of pocket beyond the down payment.

Itemized breakdown

Lender fees

The estimator uses industry-standard DSCR lender fees:

  • Origination (1%): The primary lender fee for originating the loan. Some lenders charge less (0.5%) with slightly higher rates, or zero with a higher rate (lender credits).
  • Processing ($695): Covers the cost of gathering and organizing your loan file.
  • Underwriting ($995): The underwriter's fee for reviewing and approving the file.

Total standard lender fees: approximately $1,690 + 1% of loan. On a $400,000 loan: $5,690.

Third-party fees

  • Appraisal ($675): DSCR appraisals include the standard URAR plus Form 1007 (rent comparables). Prices vary by market and complexity.
  • Credit report ($75): Tri-merge credit pull from the lender.
  • Lender's title insurance: Roughly 0.5% of loan amount on the first $200K, 0.4% above that. Reissue rates apply on refinances.
  • Recording ($175): County recording fee for the deed and mortgage.
  • Escrow/settlement ($300–$600+): The escrow officer or settlement attorney's fee for conducting the closing.

Transfer tax by state

Transfer taxes are imposed by states and sometimes local governments when real property changes hands. They apply only on purchases — not refinances. Key facts:

  • No transfer tax states: TX, AL, MT, WY, ID, NM, MS, MO, OR, ND, SD, KS, LA, IN, AZ, UT.
  • Low-tax states (<0.25%): CA (~0.11% county), CO, TN, OH, IL, KY, SC, HI, DE (VA fee), OK.
  • Mid-tax states (0.25–0.75%): FL (0.7%), MI (0.75%), MA (0.456%), MN, ME, NH, CT, MD, NC, WI, and others.
  • High-tax states (>0.75%): DE (2.5% combined buyer+seller), PA (1% + 1% seller), DC (1.1%), NJ (0.8%), WA (1.1% on mid-range), NY (0.4%+ NYC mansion tax).

Prepaids and reserves — what's not in the estimator

The estimator covers closing costs but not prepaids or reserves, which are also part of cash to close:

  • Prepaids: First year's insurance premium upfront, plus 2–3 months of tax and insurance into escrow if the lender requires impounds. Typically $3,000–$6,000 depending on state taxes and insurance.
  • Reserves: Most DSCR lenders require 3–6 months of PITIA in liquid reserves after closing. This is not paid at closing — it's verified in your account — but it's real capital you must have available.

True total cash requirement = down payment + closing costs + prepaids + reserve verification. Budget 8–12% of purchase price for the total cash-to-close and reserve requirement on a DSCR purchase at 25% down.

What's negotiable in DSCR closing costs?

Lender fees (origination, processing, underwriting) are negotiable in aggregate — lenders will often reduce or waive processing fees in exchange for a slightly higher rate, or vice versa. Third-party fees (appraisal, title, recording) are essentially fixed by the third party and not negotiable through the lender. Transfer taxes are government-imposed and not negotiable.

The most impactful negotiation is not on individual fees but on the overall rate/cost structure: choosing between a lower rate with closing costs vs a higher rate with a lender credit that covers closing costs. Use the Refi Break-Even calculator to determine which structure is better for your hold period.

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Frequently asked questions

What closing costs are typical on a DSCR loan?
DSCR loan closing costs typically include lender fees (origination 0.5–1% of loan, processing $500–$800, underwriting $800–$1,200), third-party fees (appraisal $650–$800 for SFR, lender's title policy, recording, credit report), and transfer taxes if applicable in the state. Total closing costs on a DSCR loan commonly run $6,000–$12,000 depending on loan size, state, and lender. Some lenders also charge a rate lock extension or document prep fee.
Do DSCR loans have higher closing costs than conventional loans?
Slightly, yes. DSCR lenders typically charge somewhat higher lender fees than conventional lenders (Fannie/Freddie) because they're originating non-QM portfolio loans. The origination fee, processing, and underwriting are each typically $200–$500 higher. Third-party costs (title, appraisal, recording) are similar. The appraisal on a DSCR loan includes a rent comparables addendum (Form 1007 or 1025) which may add $100–$200 to the base appraisal fee.
Which states have transfer taxes on real estate purchases?
About 37 states plus DC charge some form of transfer tax on real estate transactions. The highest rates are in Delaware (2.5%), Pennsylvania (1% buyer + 1% seller), DC (1.1%), and New Jersey (0.8%). About 13 states have no transfer tax: Texas, Alabama, Montana, Wyoming, Idaho, New Mexico, Mississippi, Missouri, Oregon, North Dakota, South Dakota, Kansas, and Louisiana. The closing cost estimator shows the transfer tax for each state.
Are closing costs different on a DSCR refinance vs purchase?
The main difference is transfer tax: on a refinance, transfer tax is not charged (no change of ownership). Otherwise, costs are similar — you'll pay lender fees, third-party fees, and title insurance. On a refinance, the title policy is typically a reissue rate (discounted) if the same title company is used within a few years of the original policy. On a rate-and-term refi, there's no additional appraisal for smaller loans at some lenders, but most DSCR lenders still require one.
Can I roll closing costs into my DSCR loan?
On a purchase loan, generally no — you typically need to cover closing costs separately from the down payment. On a refinance, you can often roll closing costs into the new loan balance, which is called a 'no-cost' refi at a slightly higher rate. Some lenders offer a 'lender credit' — they pay your closing costs in exchange for a rate that's 0.125–0.375% higher. Always model the break-even before taking lender credits vs paying out-of-pocket.
What is lender's title insurance and is it required?
Lender's title insurance protects the lender against title defects — easements, liens, boundary disputes, or errors in prior ownership documentation. It is required by virtually all DSCR lenders. Owner's title insurance (which protects the buyer) is separate and optional, but strongly recommended. For investment properties, the combined premium for both policies is typically $1,000–$3,000 depending on loan and property value.
How is the appraisal different on a DSCR loan vs a conventional loan?
The DSCR appraisal includes a rental income addendum — Form 1007 (single-family) or Form 1025 (2–4 unit). The appraiser identifies 3–5 comparable active rentals and closed leases to establish market rent. This drives the DSCR calculation. The total appraisal fee on a DSCR loan is typically $650–$850 for an SFR. Some areas with limited comp data or rural properties may run higher. Rush or 'expedited' appraisals add $100–$250.
How do I estimate my total cash to close?
Total cash to close = down payment + estimated closing costs + prepaids (first-year insurance, 3–6 months of property tax impounds into escrow if required). On a $350,000 purchase at 25% down: $87,500 down + ~$8,500 closing costs + ~$3,500 prepaids = ~$99,500 total cash to close. DSCR lenders typically require 3–6 months of PITIA in reserve in addition to cash to close — a common requirement that surprises first-time DSCR borrowers.
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