Average Closing Costs in California

California's housing market is expensive—that's not news. Between high home prices, competitive bidding, and stricter lending requirements in coastal markets, buying a house in California already requires significant financial preparation. But what catches many California homebuyers off guard is how much they'll pay in closing costs on top of the down payment. These fees can easily add another $15,000 to $20,000+ to your out-of-pocket expenses at closing, depending on your purchase price and loan structure.

Understanding these costs upfront helps you budget correctly and avoid surprises at the closing table. Many California homebuyers focus exclusively on saving for the down payment and forget to account for closing costs—then scramble when they realize they're short a few thousand dollars right before closing. Knowing what to expect and how these costs break down gives you time to plan, negotiate, and potentially reduce what you pay.

How Much Are Closing Costs in California?

According to 2024 data, average closing costs in California when buying a home were $17,581.32. That's about 21.3% higher than the national average of $14,497.99.

For refinancing, the average closing costs in California were $8,050.51, which is actually below the national average of $8,382.36.

Closing costs typically run between 3% and 6% of the loan amount. In October 2025, the median California home price was $838,000 (compared to the national median of $439,917). Using current data, California closing costs average about 2.1% of the home's sale price—well below the national average of 3.3%.

That means on a median-priced California home, you're looking at roughly $17,600 in closing costs when buying. On higher-value purchases, those costs scale up proportionally.

What's Included in Closing Costs?

Closing costs cover the fees and services required to complete your transaction. Some are paid by the buyer, some by the seller, and some can be negotiated.

Here's a breakdown of the most common California closing costs and who typically pays:

Appraisal costs – Determines the property's value, which directly affects your loan amount since lenders will only lend based on the appraised value (not the purchase price if it appraises lower). Always paid by the buyer. In some cases, lenders may waive the appraisal requirement depending on the property type, your down payment amount, and loan-to-value ratio—this is more common on conventional loans with 20%+ down on single-family homes.

Attorney fees – Legal services for the transaction, such as reviewing contracts and handling the closing process. Not required in all California counties, as California is primarily an escrow state where title companies handle most closing functions. More common in Northern California than Southern California. 

Courier fee – Delivery and handling of loan and title documents between the lender, title company, and other parties. 

Credit report fee – Fee to pull the borrower's credit history and score from all three major credit bureaus (Experian, Equifax, TransUnion). 

Escrow fees – Paid to a neutral third party (usually a title company) to hold funds and documents until closing, then distribute them according to the purchase agreement. In California, escrow fees are typically split between buyer and seller, though this can be negotiated.

Homeowners association transfer fee – If applicable, this covers the administrative cost of transferring HOA account and documents to the new owner. The seller typically pays this, though it can be negotiated.Some HOAs also require additional fees for document preparation or certification of dues paid.

Lender's title insurance – Protects the lender's financial interest in the property against title defects, liens, or ownership disputes. Always paid by the buyer and required by the lender. Coverage amount equals your loan amount and remains in effect until the loan is paid off. 

Mortgage insurance – Protects the lender (not you) if you default on the loan. Required for government-backed loans (FHA, USDA) or conventional loans with less than 20% down. FHA loans charge both an upfront mortgage insurance premium (1.75% of the loan amount, typically rolled into your loan balance) and an ongoing monthly premium. USDA loans have a similar structure with an upfront guarantee fee (1% of the loan amount) plus an annual fee. VA loans charge a one-time funding fee (varies from 1.4% to 3.6% depending on down payment and whether it's your first VA loan) but no monthly mortgage insurance. Conventional loans with less than 20% down require private mortgage insurance (PMI), which is only a monthly premium—no upfront cost—and can be removed once you reach 20% equity.

Property taxes – Prorated based on the closing date. The buyer pays from closing through the end of the tax period.

Rate lock fee – Optional fee to lock in your interest rate for a set period.

Recording fees – Paid to the county to officially record the deed and mortgage.

Survey fee – If a survey is required to establish property boundaries (uncommon in California).

Title search fee – Examines the property's ownership history to ensure there are no liens or claims.

Transfer tax – State or local tax on transferring property ownership. In California, this is typically split between buyer and seller or paid by the seller.

This list isn't exhaustive, and responsibilities can vary by county or as negotiated in the purchase agreement.

How to Lower Your Closing Costs in California

While California's housing costs are among the highest in the nation, closing costs don't have to blow your budget. Many buyers assume these fees are fixed and non-negotiable—they're not. With the right approach, you can often reduce your out-of-pocket costs by several thousand dollars.

The key is understanding which costs are lender-controlled (and therefore negotiable or avoidable through shopping), which are third-party fees you can sometimes choose your own provider for, and which are set by law or local government. Different strategies work better depending on your situation, market conditions, and how much leverage you have in the transaction.

Here are the most effective ways California homebuyers can lower their closing costs:

Ask for seller concessions. In a balanced or buyer-friendly market, you can request that the seller cover part of your closing costs as part of the purchase agreement. Seller concessions can fund a wide range of closing costs including lender fees, title insurance, escrow fees, appraisal costs, prepaid property taxes, homeowners insurance, and even discount points if you want to buy down your rate. Conventional loans typically allow up to 3%–9% of the purchase price in seller concessions depending on your down payment, while FHA loans allow up to 6% and VA loans allow up to 4%. This is common and worth negotiating—especially in markets where inventory has increased and sellers are more motivated to close deals.

Shop lenders. Different lenders charge different fees for origination, underwriting, and rate locks. As a mortgage broker, LendFriend shops multiple lenders on your behalf to find the lowest overall costs—that's one of the main reasons to work with a broker instead of going directly to a single bank.

Negotiate the purchase price. Since closing costs are often calculated as a percentage of the sale price, negotiating even a modest price reduction can lower both your loan amount and your closing costs.

Review your Loan Estimate carefully. Your lender must provide a Loan Estimate within three business days of application. This document outlines all expected fees. Compare it line-by-line with your final Closing Disclosure to catch any unexpected charges before signing. Make sure you aren't being charged any unnecessary discount points (unless you specifically chose to pay points to buy down your rate), origination charges that seem inflated, or fees you don't understand. If anything looks questionable or unclear, ask your loan officer to explain it in plain terms. Legitimate lenders should be able to justify every line item.

Close at the end of the month. You'll pay fewer prepaid interest days if your closing date falls later in the month, which can lower your total amount due at signing.

Bottom Line: California Homebuying Costs Are High but Negotiable

California's real estate market comes with high price tags and high closing costs. But understanding these costs early—and knowing which ones are negotiable—helps you plan your budget and avoid last-minute surprises.

Closing costs aren't fixed. You can reduce them through careful planning, comparison shopping, and timing. This is where working with LendFriend Mortgage makes a real difference.

As a mortgage broker, LendFriend Mortgage shops multiple lenders on your behalf to find the lowest overall costs—not just the lowest rate. We don't charge points unless you specifically choose to buy down your rate. Our fees are transparent and competitive, with no hidden charges or surprise add-ons at closing. We'll walk you through your Loan Estimate line by line so you understand exactly what you're paying for and why.

Beyond finding you better pricing, LendFriend Mortgage helps you structure a strong offer that doesn't leave money on the table. We can advise on seller concession strategies, optimal closing timing, and how to negotiate effectively in your specific market. The goal isn't just to get you approved—it's to get you approved at the best possible terms without overpaying.

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