Wondering what you really need to bring to the closing table in Denver? If you are buying your first home or relocating, the line items can feel confusing and add up fast. You deserve a clear, local breakdown so you can plan with confidence and avoid surprises. This guide explains typical ranges, what each fee covers, how loan type changes costs, and Denver-specific items to watch. Let’s dive in.
What closing costs are
Closing costs are the fees and prepaid items required to complete your home purchase and fund your mortgage. They are separate from your down payment. You will see early estimates on your Loan Estimate, and your exact numbers on your Closing Disclosure.
You receive the Loan Estimate within three business days after you apply for a loan. You receive the Closing Disclosure at least three business days before closing so you can review and ask questions.
How much you should budget
A practical range for buyer closing costs in metro Denver is about 2 to 5 percent of the purchase price, not including your down payment. If you use a government-backed loan or make a lower down payment, expect to be toward the higher end because of mortgage insurance and program fees.
Two quick examples to illustrate the range:
- On a $350,000 purchase, total buyer closing costs might land around $7,000 to $10,500 depending on loan program and escrow reserves.
- On a $600,000 purchase, buyer closing costs might be roughly $12,000 to $30,000 depending on program and escrows.
Your lender’s Loan Estimate and the title company’s figures are the source of truth for your specific transaction.
Your cost breakdown
Understanding the buckets makes it easier to plan and negotiate.
Lender-related fees
- Origination, underwriting, and processing: Charges for evaluating your application and funding the loan. These can vary by lender.
- Rate-lock or float-down options: Costs or credits tied to locking your interest rate.
- Appraisal and credit report: Third-party charges to confirm value and pull credit.
- Points or discount points: Optional upfront cost to reduce your interest rate; each point is typically 1 percent of the loan amount.
- Mortgage insurance or program fees:
- Conventional loans may require private mortgage insurance if you put less than 20 percent down.
- FHA loans include an upfront mortgage insurance premium that has historically been 1.75 percent of the loan amount, which can often be financed into the loan. Verify current rates with your lender.
- VA loans do not require PMI, though most buyers pay a VA funding fee unless exempt. Confirm your specifics with your lender.
Title and escrow services
- Title search and exam: Research to confirm clear ownership and identify liens.
- Lender’s title insurance: Protects the lender’s interest in the property.
- Owner’s title insurance: Optional but strongly recommended to protect your ownership. Who pays is often guided by local custom and negotiation.
- Escrow or settlement fee: The closing agent’s fee to handle funds and documents.
- Recording fees: Paid to Denver County to record your deed and mortgage.
Government fees and taxes
- Recording fees: County charges to record your documents.
- Colorado documentary or transfer fee: A small fee tied to the recorded consideration. It is usually modest, often measured in tens of dollars. Your title company will compute the exact amount.
- Property tax proration: You pay your share from the closing date forward. Timing of local tax billing can affect prorations and escrow deposits.
- Local assessments or special districts: Some properties are in special districts with transfer or payoff obligations. Confirm early in the process.
Prepaids and escrow deposits
- Prepaid interest: Covers interest from funding through the end of the month.
- Homeowners insurance: Often the first-year premium is collected at closing.
- Initial escrow reserves: Several months of taxes and insurance collected to set up your escrow account per lender guidelines.
- HOA items: Prorated dues, plus any HOA transfer or document fees.
Other possible charges
- Survey if required by the lender or title.
- Pest inspection if required.
- Courier and wire fees for secure funds transfer.
- Attorney fees if applicable, and any payoff or release fees for liens.
How loan type and price affect costs
Different loan programs change both your upfront and monthly costs.
- Conventional: PMI requirements and structure vary. Seller concessions are allowed but capped based on down payment and investor rules. Conventional loans may have fewer mandated upfront fees than FHA.
- FHA: Includes an upfront mortgage insurance premium and monthly mortgage insurance, which raises both upfront and ongoing costs. Seller concessions are allowed within FHA limits.
- VA: No PMI. Most buyers pay a VA funding fee unless exempt. Seller-paid costs and concessions are allowed within VA rules.
- USDA: Program-specific fees and concession limits apply.
Purchase price also matters. Some fees scale with price or loan amount, including title insurance premiums and points. Higher price points often mean higher absolute closing costs, even when percentages are similar.
Denver and Colorado specifics
- Documentary or transfer fee: Colorado charges a modest fee tied to recorded consideration. Your title company or the Denver County Clerk and Recorder can confirm the exact calculation for your closing.
- Recording fees: Set by Denver County and updated periodically. Title companies include them on your Closing Disclosure.
- Owner’s title insurance custom: In many Colorado transactions, sellers often pay part or all of the owner’s title policy premium. This is negotiable and varies by neighborhood and market conditions.
- HOA and special districts: Many Denver-area properties are in HOAs or metro districts. Expect transfer fees, estoppel letters, and collection of any unpaid assessments at closing.
- Property taxes: Taxes are prorated at closing. Whether taxes are paid semiannually or annually affects both proration and your initial escrow deposit.
Ways to reduce cash to close
- Ask for seller concessions: Sellers can credit some of your closing costs at settlement. Loan program caps and down payment levels set the maximum allowed. Your lender will confirm limits.
- Compare lenders: Fees and rates differ. Request itemized Loan Estimates from at least two lenders and compare total closing costs, not just the rate.
- Consider lender credits vs. points: A slightly higher rate can produce a lender credit that reduces upfront costs. Paying points lowers your rate but increases cash due at closing. Run the break-even math with your lender.
- Shop title and escrow: You can ask for quotes on settlement fees and title endorsements. Keep owner’s title insurance in your plan even if you negotiate who pays for it.
- Negotiate repair credits: Instead of doing repairs, a seller may credit you at closing, which can offset costs if allowed by your loan program.
Practical checklist for Denver buyers
- Get a written Loan Estimate and compare multiple lenders for both rate and fees.
- Ask the title company for an estimate of title premiums, recording, and documentary fees for Denver County.
- Confirm any HOA transfer and estoppel fees early.
- Verify whether the owner’s title policy is paid by the seller or the buyer per your contract and local custom.
- Confirm any seller concessions in the contract and that they fit your loan program limits.
- Budget for prepaids and initial escrow deposits, including the first-year insurance premium and several months of taxes.
- Review the Closing Disclosure at least 72 hours before closing and reconcile it against your Loan Estimate.
What to expect on your timeline
- Within 3 business days of loan application, you receive a Loan Estimate outlining your projected closing costs and cash to close.
- At least 3 business days before closing, you receive your Closing Disclosure with the final figures. Use this window to ask questions and coordinate your wire and signing.
Make a plan with a local guide
You do not need to solve this alone. With clear estimates, smart negotiation, and early title and HOA checks, you can control your cash to close and avoid last-minute surprises. If you want a local advocate to quarterback the process and connect you with trusted lenders and title teams, reach out to T.J. Gordon.
FAQs
How much are buyer closing costs in Denver?
- Plan for about 2 to 5 percent of the purchase price, excluding your down payment. Your exact amount depends on loan type, price point, and escrow reserves.
Can I roll closing costs into my loan?
- Some items can be financed, such as FHA upfront mortgage insurance, and some lenders offer options that increase your loan amount, which raises interest paid over time.
Who usually pays for owner’s title insurance in Denver?
- It varies by contract and market conditions; in many Colorado transactions the seller often pays all or part of the owner’s policy, but it is negotiable.
What is Colorado’s documentary or transfer fee?
- It is a modest government fee connected to the deed’s recorded consideration, typically resulting in a small charge; the title company will calculate the exact amount.
Will sellers pay my closing costs in today’s market?
- Seller concessions are common negotiation tools and depend on local supply, demand, and your loan program’s limits; your agent can guide strategy by neighborhood.
When will I know my exact cash to close?
- Your Closing Disclosure arrives at least three business days before closing and shows your final numbers, including any credits, escrows, and prorations.
