Closing costs are the fees you pay to finalize a home loan, and they come on top of your down payment. In Virginia they typically add up to a few percent of the purchase price once prepaid items are included. I’m Duane Buziak, NMLS #1110647, and I walk Glen Allen, Short Pump, and Henrico buyers through this number every week. This guide covers what each charge is, who collects it, and how to see the full figure before you commit. It also includes a worked dollar example, the ways to reduce cash to close, and the mistakes that cause last-minute surprises.
By Duane Buziak, NMLS #1110647, with Coast2Coast Mortgage LLC (NMLS #376205) as the operating company.
- What Glen Allen Buyers Actually Pay at the Closing Table
- The Fee Categories on Your Loan Estimate, Line by Line
- Worked Example: Closing Costs on a Glen Allen Home Purchase
- Ways to Lower Your Cash to Close
- How Duane Buziak Compares Quotes Without a Credit Hit
- Common Closing Cost Mistakes and Last-Minute Surprises
- Your Closing Number Is Knowable Before You Make an Offer
What Glen Allen Buyers Actually Pay at the Closing Table
Imagine a first-time buyer under contract on a townhome in Twin Hickory. She has saved her 5 percent down payment and feels ready. Then her Loan Estimate arrives and the cash needed at closing is thousands of dollars higher than the down payment alone. Nothing went wrong. She simply budgeted for one of the three buckets of money that change hands at closing.
Those three buckets are worth keeping separate:
- Down payment: your equity in the home, paid toward the price.
- Closing costs: one-time fees for creating, insuring, and recording the loan and the transfer of ownership.
- Prepaid items: money paid in advance for ongoing costs, including the first year of homeowner’s insurance, interest from closing day to month-end, and the starting deposit in your escrow account for taxes and insurance.
Prepaids are not fees in the usual sense. They fund bills you would owe anyway, but they still come out of your pocket on closing day, so they belong in your cash-to-close figure.
How big is the total? Industry studies, such as the annual closing cost research from ICE Mortgage Technology, publish averages by state, and the commonly cited range for buyers is roughly two to five percent of the purchase price. I won’t quote a single percentage here because the figure shifts every year and varies by loan type. Look up the latest edition of that study and read the Virginia line as of the date you search. Your own Loan Estimate is the only number that matters for your purchase.
One misconception deserves clearing up early: closing costs are not mostly lender profit. A large share goes to third parties. The appraiser is paid for the valuation, the title company for the search and insurance, and the Henrico Circuit Court Clerk’s office and the Commonwealth for recording the deed and deed of trust. The compensation for arranging your loan is one line in one section. Everything else is passed through to someone who did separate work.
The Fee Categories on Your Loan Estimate, Line by Line
Within three business days of your application, you should receive a Loan Estimate, a standardized three-page form. The Consumer Financial Protection Bureau’s Loan Estimate explainer shows a sample you can follow along with. Page two is where closing costs live, divided into lettered sections:
- Section A, Origination Charges: what you pay for arranging the loan, including any discount points.
- Section B, Services You Cannot Shop For: third-party services the broker or lender selects, commonly the appraisal and credit report.
- Section C, Services You Can Shop For: typically title search, settlement services, and title insurance, where you may pick your own provider.
- Section E, Taxes and Other Government Fees: recording fees and transfer or recordation taxes.
- Section F, Prepaids: homeowner’s insurance premium and prepaid interest.
- Section G, Initial Escrow Payment at Closing: the starting cushion for taxes and insurance.
A short glossary of the line items
- Appraisal: an independent opinion of value, ordered so the collateral supports the loan amount.
- Credit report: the fee to pull your scores and history for underwriting.
- Title search: a review of public records to confirm the seller can legally transfer the property.
- Lender’s title insurance: a one-time policy protecting the loan’s lien position. Your loan requires it.
- Owner’s title insurance: a separate, optional one-time policy protecting you. I recommend it for nearly every buyer.
- Recording fee: what the circuit court clerk charges to place the deed and deed of trust in the land records.
- Virginia grantor and recordation taxes: state and local taxes tied to transferring and recording property documents. Who pays which tax, and at what rate, is set by statute and can change, so confirm current rates with your settlement agent and the Virginia Department of Taxation.
Tolerance rules
Federal rules limit how much certain fees can rise between your Loan Estimate and the final Closing Disclosure. In broad terms, some charges, including origination charges, cannot increase at all. Others, such as recording fees and shoppable services from providers on the broker’s list, can rise by no more than 10 percent in total. A third group, including prepaids, escrow deposits, and services you shop for outside the provided list, can change without a cap. The exact categories and exceptions are set out in Regulation Z, and the CFPB’s guidance is the place to confirm them for your situation. If a number moves, ask which tolerance bucket it falls into.
Worked Example: Closing Costs on a Glen Allen Home Purchase
Everything below is an illustration, not a quote. I’m using a round purchase price of $475,000 for a Glen Allen single-family home, with 20 percent down. Before you plan around it, compare the figure to the current median sale price for Glen Allen on Redfin or Realtor.com. Medians move monthly, so treat any number you see as true only on the day you pull it. The fees below are assumed round numbers.
- Purchase price: $475,000
- Down payment (20 percent): $95,000
- Loan amount: $380,000
- Section A, origination: $2,200
- Section B, appraisal ($600), credit report ($75), title services and lender’s policy ($1,900): $2,575
- Section C and E, owner’s policy ($1,400) and recording fees plus recordation taxes (assumed $2,500): $3,900
- Closing costs subtotal: $2,200 + $2,575 + $3,900 = $8,675
- Prepaids and escrow: first-year homeowner’s insurance $1,600; 15 days of prepaid interest at an illustrative 6.25 percent, about $976; escrow deposit of 3 months of insurance ($400) plus 4 months of property tax on an assumed $4,000 annual bill ($1,333): $4,309
- Total cash to close: $95,000 + $8,675 + $4,309 = $107,984
Closing costs plus prepaids come to $12,984, or about 2.7 percent of the price, which fits the “few percent” pattern.
Seller credit versus rate buydown
Suppose the seller agrees to a $7,600 credit, which is 2 points on the $380,000 loan. You have two choices. In the first, you apply the credit to closing costs and keep the illustrative 6.25 percent rate. Principal and interest on a 30-year loan is about $2,340 a month. In the second, you use the credit to buy the rate down to an illustrative 5.75 percent, and the payment falls to about $2,218. That saves roughly $122 a month, so $7,600 divided by $122 puts the breakeven near 62 months. If you expect to stay at least five years, the buydown may be worth it. If you may move sooner, or cash is tight at closing, the credit serves you better.
These rates are illustrative, not current market rates. For today’s benchmark, check the weekly Freddie Mac Primary Mortgage Market Survey and note its date. Duane Buziak provides an actual Loan Estimate based on your scenario, and that document replaces every number above.
Ways to Lower Your Cash to Close
Seller concessions
A seller concession is a negotiated credit toward your closing costs. Each loan type caps it. As of this writing, Fannie Mae’s Selling Guide ties conventional limits to occupancy and down payment. For a primary residence the cap is generally 3 percent with less than 10 percent down, 6 percent with 10 to 25 percent down, and 9 percent above that. FHA limits are in HUD Handbook 4000.1 and are generally 6 percent. VA rules at va.gov separate ordinary closing costs from “concessions” with a separate limit. Caps get updated, so I confirm the current numbers before writing an offer for you.
Lender credits and the rate tradeoff
Lender credits, the term the Loan Estimate uses, work in the opposite direction from points. You accept a somewhat higher rate and the credit reduces your upfront fees. That can make sense if you plan to sell or refinance within a few years or want to keep cash in reserve. If you plan to stay a decade, the higher payment usually costs more than the credit saved. Points and credits are not the same thing. Points are prepaid interest that lowers your rate, while credits are the reverse. Asking me to quote both on the same scenario takes the guesswork out.
Program-specific charges
VA loans carry a one-time funding fee, with some veterans exempt, and it can be financed into the loan. The VA’s funding fee page lists the current percentages. FHA loans carry an upfront mortgage insurance premium, also financeable, plus a monthly premium. These appear apart from standard fees because they are government program charges, not services someone performed.
Virginia down payment assistance programs, including those offered through Virginia Housing and other participating programs, exist and rules change. As of this writing, availability and income limits should be checked directly with the program before you rely on them. If cash to close is your obstacle, ask about our no-out-of-pocket closing options and I’ll tell you what is realistic for your loan type.
How Duane Buziak Compares Quotes Without a Credit Hit
A broker can price a file across many wholesale options at once. That matters because rate and fees need to be weighed together. A quote with a slightly lower rate but higher Section A and B charges can cost more over your actual time in the home than a quote with the reverse.
To keep your score untouched during that shopping, I use the NoTouch Credit Pull, a soft credit pull mortgage option. It lets you see pre-approval estimates and fee scenarios without a hard inquiry. The company describes it as using VantageScore 4.0, and I’ll point you to that description rather than characterize how any other party scores your file. A full credit pull comes later, once you choose to move forward.
The table below is a starting framework. I have filled in only what I can state firmly and marked the rest to verify directly with each company.
| Factor | Duane Buziak | Courtney Ficken, First Home Mortgage | Rocket | Movement |
|---|---|---|---|---|
| Fee transparency | Itemized Loan Estimate, with fee scenarios reviewed side by side | Verify with the loan officer | Verify in the online quote | Verify with the loan officer |
| Local Glen Allen knowledge | Office at 4860 Cox Rd, Glen Allen; serves Twin Hickory, Wyndham, Innsbrook, and Short Pump | Verify neighborhood-level experience | National online platform; verify local support | National company; verify local branch and officer |
| Soft-pull options | NoTouch Credit Pull, no hard inquiry for estimates | Verify | Verify | Verify |
| How quotes are delivered | Phone and in-person consultation, then Loan Estimate | Verify | Verify (app or online) | Verify |
Whoever you shop with, follow the same process:
- Request Loan Estimates from each broker or lender on the same day, so the rates and market conditions match.
- Compare Section A and Section B first, since those are the charges you cannot shop around.
- Ask each one for the rate lock period, the lock cost, and what happens if closing runs past it.
- Compare the total cash to close, not just the monthly payment.
Common Closing Cost Mistakes and Last-Minute Surprises
These are the errors I see most often:
- Comparing only rates. A low rate can come with high points, and a low total cost can hide a higher rate. Compare both.
- Ignoring prepaid escrow. Taxes and insurance deposits can run into the thousands and are not part of the “fees” most buyers picture.
- Skipping the title shopping. Section C items are shoppable. When the rules allow you to choose, get a second quote.
- Forgetting the first-year insurance premium. It is normally paid in full at or before closing, so call an insurance agent early.
Timing and the Closing Disclosure
Under the CFPB’s TRID rule, the lender or broker must deliver your Closing Disclosure at least three business days before closing. See the CFPB’s Closing Disclosure explainer. Set it next to your Loan Estimate and check line by line, especially the tolerance items. Questions asked on day one are easier to fix than questions asked at the table.
Henrico property taxes and your escrow deposit
Your escrow deposit depends on the local real estate tax. Henrico sets its rate annually per $100 of assessed value, and the current figure is published by the county’s Finance Department. To estimate your own deposit, multiply the assessed value by the rate divided by 100, then divide by 12 for the monthly amount. Confirm the rate on that page rather than trusting last year’s number.
Closing day
Bring certified funds or arrange a wire, and verify wire instructions by phone using a number you already know, never one from an email. Wire fraud targets homebuyers because the amounts are large and the timing is predictable. If anything about the instructions changes late, stop and call the title company before sending money.
Your Closing Number Is Knowable Before You Make an Offer
Closing costs only feel like a surprise when no one has run them. Between a Loan Estimate, a clear view of prepaids, and a plan for credits, the figure you will bring to the table can be calculated before you ever write an offer on a home near Crump Park or West Broad Village. For a personalized estimate through a no hard inquiry mortgage pre approval, call me at 804-212-8663 or stop by 4860 Cox Rd, Glen Allen, VA 23060.
Ready to experience stress-free mortgage approval with no credit hit and access to hundreds of lenders at once? Get your free mortgage consultation today and discover why Glen Allen families trust Duane Buziak for personalized guidance and the fastest close times in the area.
