$6,905.
That's the national average for refinance closing costs excluding transfer taxes, according to CoreLogic's 2025 analysis. Add transfer taxes and the average climbs to $10,300. Factor in prepaid items — escrow deposits, homeowners insurance, prepaid interest — and many borrowers walk into closing needing $12,000–$15,000.
That figure surprises a lot of people. It shouldn't. A refinance replaces one legal instrument secured by your home with another. The legal, administrative, and risk-assessment infrastructure required to do that safely has real costs — and somebody pays them.
The good news: these costs are far more negotiable and variable than most borrowers realize. I've seen borrowers on the same loan size in the same state pay $4,200 or $9,800, depending entirely on how aggressively they shopped and negotiated.
Key Takeaways- National average refinance closing costs: $6,905 excluding transfer taxes; $10,300 including them (CoreLogic 2025)
- Typical range: 2–5% of loan amount — on a $300,000 refinance, budget $6,000–$15,000
- Lender-charged fees (origination, underwriting) are the most negotiable items; third-party fees (appraisal, title) can be shopped between providers
- You can roll closing costs into your loan balance if you have sufficient equity — but you'll pay interest on the added amount
- Per Freddie Mac research, borrowers who compare 5+ lenders save an average of $3,500 in total loan costs
The Two Categories of Closing Costs
Every fee on your Loan Estimate falls into one of two buckets, and understanding which is which determines your negotiating strategy.
Lender fees are charged by your specific lender — they're the most negotiable items on the list because the lender has full discretion over them.
Third-party fees are charged by outside service providers (appraisers, title companies, attorneys, government recording offices). Less directly negotiable, but you often have the legal right to shop for these yourself.
Lender Fees: What You're Actually Paying the Lender
| Fee | Typical Range | Negotiability |
|---|---|---|
| Origination fee | 0.5%–1.5% of loan | High — most negotiable item |
| Application fee | $0–$500 | High — often waived |
| Underwriting fee | $400–$1,200 | Moderate |
| Rate lock fee | $0–$1,000 | Moderate (usually built into rate) |
| Discount points (optional) | 1% per point | Your choice — pay to reduce rate |
Per 2025 HMDA data, origination fees on conforming loans ranged from $0 to over $12,000 — an astonishing range on loans of similar size. The median was approximately 0.66% of loan amount. On a $300,000 refinance, that's $1,980, but the range means some borrowers paid nothing while others paid $4,000+ for an equivalent loan.
Third-Party Fees: What Goes to Outside Providers
| Fee | Typical Range | Can You Shop? |
|---|---|---|
| Appraisal | $300–$1,000 | Limited (lender often selects) |
| Title search | $75–$250 | Sometimes |
| Lender's title insurance | $500–$2,000 | Yes — most impactful shoppable item |
| Settlement/closing fee | $300–$800 | Yes |
| Recording fees | $20–$250 | No (government-set) |
| Attorney fees | $500–$1,500 | Sometimes (required in some states) |
| Credit report | $30–$100 | No |
The CFPB flagged in its May 2024 Request for Information on closing costs that credit report fees have increased markedly in recent years, outpacing inflation — a cost shift that benefits neither consumers nor a competitive mortgage market.
Prepaid Items: Cash to Close vs. Closing Costs
Many borrowers conflate closing costs with total cash to close. They're different. Prepaid items are advance payments for ongoing expenses — not fees for the transaction itself, but still cash you need at closing:
- Homeowners insurance premium: Often 12 months paid upfront
- Prepaid mortgage interest: From closing date to end of month
- Property tax escrow: 2–6 months deposited into escrow account
- Mortgage insurance premiums: If applicable
These can add $3,000–$6,000 to your total out-of-pocket requirement. Always ask your lender to present: (1) Section A–H closing costs, (2) prepaid items separately, and (3) total cash to close. You need all three numbers to plan accurately.
What Refinance Closing Costs Look Like by State
Geography has an outsized effect on what you'll pay. LodeStar Software Solutions' analysis of 2024 closing cost data found dramatic variation:
| State | Average Closing Costs | As % of Loan Amount |
|---|---|---|
| New York | $6,565 | 2.1% |
| Washington D.C. | $6,773 | 1.19% |
| Connecticut | ~$5,900 | 1.8% |
| Florida | ~$4,100 | 0.85% |
| Texas | ~$3,200 | 0.70% |
| Indiana | ~$1,400 | 0.52% |
| Missouri | $1,196 | 0.45% |
| California | $1,746 | 0.33% |
The variation is primarily driven by state transfer taxes, mandatory attorney involvement, and mortgage recording taxes. New York's notorious costs reflect all three: mandatory attorney fees, substantial state mortgage recording taxes (0.75–1.0% in New York City), and NYC-specific surcharges.
California's relative affordability reflects lower title insurance rates and no state transfer tax on refinances. Missouri and Indiana have minimal state-imposed costs and competitive local title markets.
What's Actually Negotiable — And How to Negotiate It
The practical answer: approximately 40% of the line items you'll see are meaningfully negotiable. Here's how to approach each category.
Origination Fee: Your Biggest Lever
This single line item — which covers the lender's processing, underwriting overhead, and profit margin — is the most negotiable element of any Loan Estimate. In a competitive market, lenders will reduce or eliminate it to win your business.
The approach: after receiving multiple Loan Estimates, call your preferred lender and say directly: "Lender X is offering the same rate with a $500 origination fee versus your $2,200. Can you match that?" Most lenders would rather reduce origination than lose the loan. On a $300,000 refinance, saving 0.5% on origination is $1,500.
Application and Underwriting Fees: Often Eliminate-able
Many lenders charge $0 for both. If yours charges $300–$500 for application and $800–$1,200 for underwriting separately from origination, you're looking at $1,100–$1,700 in potentially eliminable fees. Ask directly to have them waived or rolled into a combined origination structure.
Per 2025 CFPB enforcement data, in 73% of cases where borrowers formally challenged excessive fees in writing, lenders reduced or removed them. This data point should give borrowers confidence that questioning fees is not just acceptable — it's often effective.
Title Insurance: The Most Impactful Shoppable Service
Under CFPB rules, lenders must inform you which settlement services you have the right to shop for independently. Lender's title insurance is almost always on that list. Title rates can vary by 30–50% between title companies in the same market for identical coverage.
Call two or three local title companies directly, ask for their refi title insurance rate on your loan amount, and compare. A difference of $400–$800 on this single item is common.
Appraisal: Ask About Waivers First
Before accepting the $500–$900 appraisal fee as a given, ask your lender upfront: "Is this loan eligible for an appraisal waiver through Fannie Mae's Desktop Underwriter or Freddie Mac's Loan Product Advisor?"
Both agencies allow automated appraisal waivers (using their property databases) on eligible refinances — typically low-LTV loans with clean payment histories on single-family properties. An appraisal waiver eliminates the fee entirely and cuts 1–2 weeks from your timeline.
Run the numbers for your situation: Use our free refinance calculator to compare your current loan with a new rate and find your breakeven point.
Recording Fees: Non-Negotiable, But Worth Knowing
Recording fees are set by county and state government. They typically run $50–$250. Nothing to negotiate here, but understanding that these are government fees helps you identify which items on your Loan Estimate are genuinely flexible.
The Lender Shopping Imperative
Per Freddie Mac research, borrowers who obtain quotes from at least 5 lenders save an average of $3,500 in total loan costs. That figure dwarfs the effort involved in making four additional phone calls or online applications.
The key to effective comparison: request a Loan Estimate (not just a rate quote) from each lender. The Loan Estimate is a standardized CFPB document that makes apples-to-apples comparison possible. Focus on:
- Section A: Origination charges (lender fees)
- Section B: Services you cannot shop for
- Section C: Services you can shop for
- Lender Credits (negative amounts that offset costs)
- APR (reflects both rate and fees over the loan term)
Don't compare rates in isolation. A lender at 6.73% with $5,000 in fees may be better than a lender at 6.65% with $9,000 in fees. Run the full break-even calculation for each quote. Get the number upfront with our closing cost estimator.
Can You Roll Closing Costs Into Your Refinance?
Yes — subject to LTV limits. Rolling closing costs into your new loan balance is a widely available option that eliminates the upfront cash requirement.
How it works: Your refinance loan amount increases by the amount of your closing costs. Instead of refinancing a $280,000 balance, you'd close a $286,905 loan. Your rate stays at market rate, but you now pay interest on the additional $6,905.
The long-term cost: - Added balance: $6,905 at 6.73% - Total interest on that balance over 30 years: approximately $9,500 - Net cost of rolling in vs. paying upfront: ~$9,500 additional interest over the loan's life
That's more expensive than paying upfront — but significantly less expensive than accepting a lender-credit no-cost rate premium, which on the same loan would cost approximately $27,000 in additional interest over 30 years.
The LTV Constraint
Rolling in costs requires that your post-refinance LTV stays within program limits. For conventional rate-and-term refinances, the limit is 97% LTV (with PMI above 80%). For cash-out refinances, it's 80% LTV.
Example: - Home value: $350,000 - Current balance: $280,000 (80% LTV) - Closing costs: $6,905 - Post-roll balance: $286,905 (82% LTV) - Result: Exceeds 80% — may trigger PMI or require conventional high-LTV mortgage insurance
If your existing LTV is tight, rolling in costs may push you into PMI territory. In that case, either pay closing costs out-of-pocket, negotiate them down first, or explore whether a lender credit (accepting a rate premium) is the more economical path. See no-closing-cost refinance for the detailed break-even comparison.
Cash-Out Refinance: Rolling In vs. Cashing Out
One nuance: if you're doing a cash-out refinance, you're already increasing your loan balance for the equity you're withdrawing. Rolling closing costs into a cash-out refi means your new balance is higher still — both the cash amount plus the fees. With the 80% LTV ceiling applying, this further reduces your available cash proceeds.
Always ask your lender to show you the exact math: your new balance, LTV, monthly payment, and estimated total interest paid — with and without rolled-in costs.
Understanding the Loan Estimate: Where to Find Every Fee
The CFPB-standardized Loan Estimate you receive within 3 business days of application is your roadmap to closing costs. Key sections:
Page 1: Loan Terms and Projected Payments — confirms rate, loan amount, monthly payment.
Page 2, Section A: Origination Charges — all lender fees. These are your primary negotiation targets.
Page 2, Section B: Services You Cannot Shop For — appraisal, credit report, flood determination. Limited negotiability.
Page 2, Section C: Services You Can Shop For — title search, settlement agent, title insurance. Shop these.
Page 2, Section E: Taxes and Other Government Fees — recording fees, transfer taxes. Non-negotiable.
Page 2, Section F: Prepaids — insurance, prepaid interest, mortgage insurance premium. Not closing costs per se, but still cash needed.
Page 2, Section G: Initial Escrow Payment — escrow account seed money for taxes and insurance. Not negotiable but sometimes timing can be adjusted.
Page 2, Section J: Lender Credits — any credits from the lender reducing your out-of-pocket costs (in exchange for a higher rate). A negative number here is part of a no-cost structure.
Refinance Closing Costs vs. Purchase Closing Costs
Refinance closing costs are typically lower than purchase closing costs because you're not dealing with buyer/seller agent commissions and many transfer-related expenses are reduced or eliminated.
| Item | Purchase | Refinance |
|---|---|---|
| Real estate agent commissions | 2.5–3% (buyer's side) | None |
| Transfer taxes | Full amount | Often reduced or exempt |
| Title insurance (owner's policy) | Required | Not required (lender's only) |
| Origination fee | Similar | Similar |
| Appraisal | $300–$1,000 | $300–$1,000 (or waived) |
| Typical total range | 3–6% of purchase price | 2–5% of loan amount |
On a $350,000 purchase, closing costs might run $10,500–$21,000. On a $300,000 refinance, they typically run $6,000–$15,000. The refinance advantage is meaningful.
Practical Checklist Before Your Closing
Before signing anything, verify these five things:
- Loan Estimate matches Closing Disclosure — you must receive the Closing Disclosure 3 business days before closing. Compare it line-by-line to your Loan Estimate. Any fee increase of more than 10% requires justification.
- You got quotes from at least 3 lenders (ideally 5). If you only called one lender, you've left money on the table.
- You asked about appraisal waivers and confirmed whether you're eligible.
- You shopped title insurance independently if your state allows it.
- You understand the total cash to close, including prepaids — not just the closing cost subtotal.
Use the refinance calculator to model your post-refinance monthly payment and break-even timeline before you sit down at the closing table.
Frequently Asked Questions
How much does it cost to refinance a mortgage?
National average refinance closing costs are $6,905 excluding transfer taxes, per CoreLogic's 2025 analysis — rising to $10,300 when transfer taxes are included. As a percentage of loan amount, expect 2–5%. On a $300,000 loan, budget $6,000–$15,000 for closing costs plus prepaid items combined.
Can I refinance with no out-of-pocket closing costs?
Yes, through two options: accepting a slightly higher interest rate (lender credits that cover your fees) or rolling closing costs into your loan balance. Neither eliminates the cost — both involve paying over time rather than upfront. The rate-premium no-cost option is usually most economical only for borrowers planning to sell or refinance within 3–5 years. See the no-closing-cost refinance guide for a full break-even analysis.
What closing costs are negotiable on a refinance?
Lender-controlled fees — origination, application, underwriting — are the most negotiable, representing roughly 40% of total line items. In 2025, CFPB data showed that 73% of formal written challenges to excessive fees resulted in reductions or removals. You can also shop title insurance independently in most states, which can save $400–$800.
Can I roll closing costs into my refinance loan?
Yes, if you have sufficient equity to maintain your program's LTV limits. Rolling in $6,905 on a $280,000 refinance creates a $286,905 balance and costs approximately $9,500 in additional interest over 30 years at 6.73%. This is more expensive than paying upfront but less expensive than accepting a rate premium for the same amount.
Are refinance closing costs tax deductible?
Generally not as a lump sum. Origination fees paid to reduce your rate (discount points) can be deducted amortized over the life of the loan. Prepaid mortgage interest is deductible in the year paid. Other fees — appraisal, title, recording — are not deductible. Investment property rules differ significantly. Consult a tax professional for your specific situation.
Why are closing costs so much higher in some states?
State laws determine transfer taxes, mortgage recording taxes, mandatory attorney involvement, and title insurance requirements. New York charges both state and NYC mortgage recording taxes plus requires attorney representation, driving costs above $6,500. Missouri and Indiana have minimal state-imposed costs and competitive local markets, keeping costs under $1,500. The same loan in different states can vary in total closing costs by 4–5x.
How do I compare closing costs between lenders?
Request a Loan Estimate (not just a verbal rate quote) from each lender within the same short window. Compare Section A (origination charges), Section B (required services), and any lender credits. Then calculate the total out-of-pocket cost and the APR — which incorporates fees into the annualized rate. The lender with the lowest APR, given your planned time horizon, typically offers the best overall deal.
Before calling lenders, get a realistic estimate of your state-specific closing costs with the closing cost estimator. Once you have real Loan Estimates in hand, compare total cost — not just rate — using our refinance calculator. For the full decision framework on whether to pay closing costs upfront, roll them in, or go no-cost, read no-closing-cost refinance: how it works and is it worth it.
