Start by separating costs from the down payment.
Closing costs cover services, disclosures, protection, and transaction work needed to originate and settle the loan. The down payment is the portion of the purchase price not financed. Both can contribute to cash to close, but they describe different parts of the transaction.
The Consumer Financial Protection Bureau's closing fee overview explains common categories and why estimates should be reviewed line by line.
Loan charges relate to originating and evaluating the request.
Loan-related items can include lender charges, credit services, appraisal work, and other required services. The type and amount depend on the requested loan and service providers. Some services may be selected by the lender, while others may permit borrower shopping under the applicable disclosure.
Use the Loan Estimate to identify which costs are attributed to the loan and which service choices may be available. Ask how each item is calculated rather than relying on a general percentage.
Texas title and settlement work has its own structure.
Title work examines ownership and covered title matters, supports the transfer, and helps coordinate settlement. Texas regulates title insurance forms and premium rates through the Texas Department of Insurance. Other transaction and service charges can still vary.
Read the Texas Department of Insurance title insurance FAQs for an official explanation of policies, premiums, and consumer questions.
Taxes and recording are property-specific.
Texas property taxes are administered locally within a state legal framework. Appraisal districts determine taxable values, and local taxing units set rates. The closing can include tax prorations or escrow collections based on the property and timing.
The Texas Comptroller's property tax resources explain the roles of appraisal districts, taxing units, and property owners. Recording charges can also appear for documents filed with the county.
Insurance and escrow affect the amount due.
Homeowners insurance must meet the requirements that apply to the property and loan. A premium may be due before or at closing. If the loan uses an escrow account, initial funds may also be collected for future tax and insurance payments.
Texas homeowners can review policy and shopping information from the Texas Department of Insurance. The insurer determines coverage and premium; the lender confirms whether the policy satisfies loan requirements.
Compare the disclosures, not just the total.
Review the Loan Estimate early and the Closing Disclosure when provided. Trace changes by category, confirm deposits and credits, and ask which figures are final or still subject to adjustment. A careful review should explain both the total and the reason for each charge.
VA-backed transactions add a program-specific funding-fee review, exemption status, permitted fee rules, and the distinction between ordinary closing-cost credits and VA-defined seller concessions. The official VA funding-fee and closing-cost guidance, reviewed July 20, 2026, limits concessions to 4% of reasonable value but does not apply that same percentage limit to credits for the loan's ordinary closing costs. See the VA funding-fee and closing-cost guide before applying the general Texas categories to a VA purchase.