Is the cash you need at closing a mystery? You are not alone. Many Richmond buyers focus on the down payment and are surprised by the other costs due on closing day. This guide breaks down what closing costs include, how much to budget, when you will see final numbers, and Richmond-specific items to keep on your radar. Let’s dive in.

Closing costs explained

Closing costs are the non-principal expenses required to complete your home purchase. They cover lender fees, title and settlement services, government recording charges, and prepaid items like insurance and taxes. These amounts vary by loan type, price point, and location.

While every contract is different, buyers in Richmond typically pay lender-related fees, appraisal, lender’s title insurance, settlement charges, recording fees, and most prepaid items. Sellers may cover the owner’s title insurance and any customary seller costs, but this is negotiable. For a plain-language overview, review the Consumer Financial Protection Bureau’s guide on what closing costs include.

Typical buyer fees in Richmond

Lender and appraisal

• Loan origination and processing. Many lenders charge application, underwriting, and origination fees. These can total roughly 0.5% to 1.5% of the loan amount before any optional discount points.
• Appraisal. Most loans require an appraisal to confirm value. In the Richmond area, a single-family appraisal often runs about $400 to $800 depending on complexity.
• Credit report and flood determination. These are small fixed fees, often $25 to $100 combined.

Title, settlement, and recording

• Title search and settlement. This covers the title exam, document preparation, and the closing or escrow agent’s fee. Costs can range from several hundred to a few thousand dollars based on price and state rate schedules.
• Title insurance. The lender’s policy is typically a buyer expense when you finance. An owner’s policy protects your ownership. Who pays for the owner’s policy in Virginia is a local custom and negotiable, so ask your agent or title company what is typical in Richmond. For basics, see ALTA’s consumer explainer on title insurance.
• Recording and transfer charges. Cities and counties set fees for recording the deed and mortgage and may charge applicable transfer taxes. Amounts vary by jurisdiction and can change.

Prepaids, escrows, and other items

• Prepaid interest. You will pay interest from your closing date to the start of your first mortgage payment.
• Homeowner’s insurance. Lenders often require you to pay the first year’s premium upfront, plus an initial escrow deposit.
• Escrow reserves. Many lenders collect 2 to 6 months of taxes and insurance to seed your escrow account.
• Property tax proration. If the seller prepaid taxes for a period that extends past your closing date, you will reimburse them at closing.
• HOA or condo fees. You may see a transfer fee, prorated dues, an estoppel or resale certificate fee, and sometimes a capital contribution.
• Surveys or certifications. If required by your lender or chosen by you, budget a few hundred dollars.
• Mortgage insurance. Conventional loans with less than 20% down may include private mortgage insurance. FHA and VA loans have program-specific fees.

How much to budget

A common rule of thumb is 2% to 5% of the purchase price for buyer closing costs, not including your down payment. Prepaid items and escrow deposits are additional and can increase the total cash needed at closing.

For example, on a $350,000 purchase, you might estimate about 2.5% in closing costs, or roughly $8,750, plus about $2,000 to $4,000 in prepaids and escrows. That puts your cash to close for costs around $10,750 to $12,750, separate from any down payment. These are illustrative figures only. Always use your lender’s and title company’s estimates for your specific property and program.

When you will see the numbers

After you apply, your lender must provide a Loan Estimate within three business days. This document outlines your projected interest rate, monthly payment, and itemized closing costs. Learn how to read it using the CFPB’s Loan Estimate guide.

At least three business days before closing, your lender must give you a Closing Disclosure with final costs and cash to close. Use this window to confirm wiring or cashier’s check instructions and ask questions. The CFPB explains what to review on the Closing Disclosure.

Richmond and Virginia specifics

• Local jurisdictions. Fees for recording and transfer vary among Richmond City, Henrico County, Chesterfield County, Hanover County, and other localities. Your title company will itemize the correct charges for the property’s jurisdiction.
• Title insurance custom. In many Virginia transactions the seller may pay for the owner’s title policy, but this is not universal. Your purchase contract can allocate this, so ask what is customary in your area when you write the offer.
• Taxes and billing cycles. Local treasurers bill taxes on different schedules. Taxes are prorated at settlement, so request current bills early to avoid surprises.
• Condos and HOAs. Expect potential transfer, resale certificate, estoppel, and capital contribution fees in condominium and planned community purchases. Your agent can confirm typical items for a given building or association.
• Flood zones and surveys. Parts of Greater Richmond are in designated flood zones. Lenders order a flood determination and may require flood insurance. Ask early so you can budget correctly.

Ways to manage your costs

• Compare Loan Estimates. Request quotes from more than one lender and compare the interest rate and total costs, not just one fee category.
• Consider seller concessions. Your offer can ask the seller to pay a portion of your closing costs. The allowable amount depends on your loan program and down payment, so discuss limits with your lender.
• Review title and settlement quotes. Ask your title company for a fee estimate and whether any bundled pricing is available.
• Time your closing date. Closing near the end of the month can reduce prepaid interest, although it may affect scheduling. Ask your lender and title company for the tradeoffs.
• Buy points only if it pencils. Discount points increase upfront costs in exchange for a lower rate. Have your lender show the break-even timeline.

Your step-by-step checklist

1. Get fully pre-approved, then request a written Loan Estimate. Confirm the interest rate, projected payment, and total estimated closing costs.
2. Ask your agent who typically pays the owner’s title policy in Richmond today and what recording or transfer fees apply in the home’s jurisdiction.
3. Compare at least two lender quotes. Look at the APR, lender fees, and estimated cash to close.
4. Budget conservatively. Plan for 2% to 5% of the purchase price in closing costs plus prepaids and escrow deposits.
5. Negotiate seller concessions in your offer if appropriate, and spell out which fees the seller will cover.
6. Review your Closing Disclosure carefully at least three business days before signing. Confirm your final cash to close and how to deliver funds.
7. Prepare for HOA or condo-specific items, any required survey, and resolution of outstanding municipal liens if applicable.
8. Verify wiring instructions by phone with your settlement company using a known number. For best practices, see ALTA’s tips on avoiding wire fraud.
9. After closing, confirm your deed and mortgage were recorded and request copies from your title company.

A calm, confident path to the closing table

Understanding your closing costs lets you shop smarter, negotiate with clarity, and arrive at the table prepared. With thoughtful planning and the right team, you can protect your budget and reduce stress from contract to keys.

If you would like a local, step-by-step review of your cash to close and how to structure seller credits in today’s market, connect with The Laura Peery Team. We provide calm guidance, skilled negotiation, and concierge-level support from offer to closing.

FAQs

What are typical buyer closing costs in Richmond?

• Many buyers see 2% to 5% of the purchase price in closing costs, plus additional prepaids and escrow deposits for taxes and insurance.

When do I get my final closing numbers?

• Lenders must deliver a Closing Disclosure at least three business days before closing so you can review costs and confirm your cash to close.

Can a seller pay some of my closing costs in Virginia?

• Yes, seller concessions are common and negotiable; the maximum allowed depends on your loan program and down payment, so check with your lender.

Who pays for owner’s title insurance in Richmond?

• It is often a local custom and negotiable in the contract; in parts of Virginia the seller may pay, but you should confirm current practice with your agent or title company.

How do HOA and condo fees affect my closing costs?

• You may see a transfer fee, prorated dues, and a resale certificate or estoppel fee, and some communities collect a capital contribution at closing.

How can I avoid wire fraud when sending closing funds?

• Always verify wiring instructions by phone using a trusted number for your settlement company and be wary of last-minute email changes that ask you to reroute funds.