Closing costs are one of the most consistently underestimated expenses in a home purchase. Buyers who budget carefully for their down payment sometimes do not fully account for the thousands of dollars in additional costs due at the closing table.
In New Jersey, buyer closing costs typically range from two to four percent of the purchase price. On a $700,000 Bergen County home, that is $14,000 to $28,000 in addition to the down payment.
Here is exactly what you are paying for and why.
LENDER FEES
Your mortgage lender charges fees for processing, underwriting, and funding your loan. Common lender fees include:
Origination fee — typically 0.5 to 1 percent of the loan amount, charged for processing the loan application.
Underwriting fee — $500 to $1,000 for reviewing and approving your loan file.
Discount points — optional prepaid interest that reduces your interest rate. Each point costs one percent of the loan amount and typically reduces the rate by 0.25 percent. Whether buying points makes sense depends on how long you plan to stay in the home.
Application and processing fees — smaller administrative charges that vary by lender.
When comparing lenders, look at the Loan Estimate — a standardized document the lender must provide within three business days of application — to compare the full cost of each lender's offer, not just the interest rate.
APPRAISAL FEE
The lender requires an appraisal to confirm the home is worth at least the purchase price. The appraisal is ordered and paid for by the buyer, typically $500 to $800 for a standard single-family home in Bergen County.
TITLE INSURANCE
Title insurance protects against defects in the title to the property — claims from prior owners, undisclosed liens, recording errors, and similar issues.
In New Jersey, there are two types of title insurance:
The lender's title policy is required by your mortgage lender and protects the lender's interest up to the loan amount. The premium is typically $800 to $1,500 for a Bergen County purchase.
The owner's title policy is optional but strongly recommended. It protects your ownership interest and is a one-time premium paid at closing. On a $700,000 purchase, an owner's policy typically costs $1,500 to $2,500. This is a lifetime policy — you pay once and are covered for as long as you own the home.
ATTORNEY FEES
New Jersey is an attorney review state, and buyers should have their own attorney represent them in the transaction. Attorney fees for buyers typically range from $1,500 to $2,500 for a standard residential purchase.
The attorney reviews the contract during the attorney review period, handles any modifications, reviews title and closing documents, and represents you at closing. Having an experienced real estate attorney is not optional — it is essential in New Jersey.
HOME INSPECTION FEE
While technically paid before closing, the home inspection fee is part of the total cost of purchasing a home. In Bergen County, home inspections typically cost $500 to $800 for a standard single-family home, and more for larger properties or those requiring specialized inspections such as radon, oil tank, or septic.
PREPAID ITEMS
Prepaid items are costs you pay in advance at closing, including:
Homeowner's insurance — typically the first year's premium, paid upfront. Annual premiums for Bergen County homes commonly range from $1,500 to $3,000 depending on the home's value and coverage.
Prepaid property taxes — lenders typically require you to fund an escrow account with several months of property taxes at closing.
Prepaid interest — interest on your loan from the closing date to the end of the month.
MANSION TAX
For purchases above $1 million in New Jersey, a mansion tax of one percent applies — paid by the buyer. On a $1.2 million purchase, that is $12,000 in addition to all other closing costs.
RECORDING FEES AND MISCELLANEOUS
Recording fees for registering the deed and mortgage documents with the county are typically $200 to $400. Additional miscellaneous costs — document preparation, wire fees, and similar items — add another $200 to $500.
FREQUENTLY ASKED QUESTIONS
What are typical closing costs for a buyer in New Jersey?
New Jersey buyer closing costs typically range from two to four percent of the purchase price, including lender fees, appraisal, title insurance, attorney fees, homeowner's insurance, prepaid taxes, and recording fees.
Who pays closing costs in NJ — buyer or seller?
In New Jersey, both buyers and sellers have closing costs. Buyers pay lender fees, appraisal, title insurance, attorney fees, and prepaid items. Sellers pay the realty transfer fee, their own attorney fees, and their portion of the agent commission.
Can closing costs be rolled into the mortgage in NJ?
In some cases, closing costs can be financed through the mortgage — for example, by accepting a slightly higher interest rate in exchange for a lender credit. This reduces your cash needed at closing but increases your monthly payment over time.
Is there a mansion tax in NJ for buyers?
Yes. New Jersey charges a one percent mansion tax on purchases above $1 million, paid by the buyer. On a $1.2 million purchase, that is $12,000.
How do I contact The Meena Patel Group about buying a home?
Call or text (201) 677-8843, email [email protected], or fill out the contact form at www.TheMeenaPatelGroup.com.
READY TO TALK?
If you want a clear, specific picture of what buying a home in Bergen County will cost — all in — reach out to The Meena Patel Group.
Call or text (201) 677-8843, email [email protected], or fill out the contact form at www.TheMeenaPatelGroup.com. No pressure. Just clarity.
