Closing costs are the fees paid to finalize a real estate transaction, including lender charges, title insurance, escrow/settlement fees, recording fees, transfer taxes, and prepaid items like property taxes and insurance.

Buyer closing costs commonly run about 2%–5% of the purchase price, while seller costs (including agent commissions) are often higher. The exact total depends on your location, loan, and negotiated terms.

Both pay different costs, and some are negotiable. Buyers typically cover lender and title fees; sellers typically cover commissions and transfer taxes, though this varies by market and contract.