Thinking about a home in Bethesda but also touring Northern Virginia? The homes may feel similar, but your closing costs can look different line by line. You want a clear picture before you write an offer, especially when you are budgeting for lender fees, title insurance, and taxes.
In this guide, you’ll learn the main cost categories, how Maryland and Northern Virginia typically allocate them, what is negotiable, and how your timeline and disclosures work. You will also see two quick, illustrative examples to help you plan. Let’s dive in.
What closing costs include
Closing costs generally fall into these categories:
- Transfer and recordation taxes. Charged when the deed and mortgage are recorded with the county or state.
- Title work and title insurance. Title search, exam, settlement fees, plus one-time owner’s and lender’s title insurance policies.
- Lender-related charges. Origination, underwriting, appraisal, credit report, and lender’s title insurance if you finance.
- Escrows, prepaids, and prorations. Homeowner’s insurance, initial escrow deposits, and prorated taxes and HOA dues from your closing date forward.
- Settlement agent or attorney fees. Title company or closing attorney charges for handling the transaction.
- Miscellaneous fees. Recording, notary, courier, HOA/condo transfer or estoppel fees, survey, and any required inspections.
How Maryland handles costs (Bethesda/Montgomery County)
- Transfer and recordation taxes. Maryland and Montgomery County assess taxes and fees when the property transfers and when the mortgage is recorded. Local custom in many Montgomery County deals is for the seller to cover some transfer taxes, but this is negotiable in the contract.
- Title insurance and title work. An owner’s policy is a one-time premium tied to the purchase price, typically in the range many markets see of about 0.25% to 0.8% of price. The lender’s policy is separate. Who pays for the owner’s policy can be negotiated.
- Lender fees. Typical ranges include appraisal about $400 to $800 or more, credit report about $30 to $50, and other lender charges that can run from hundreds to a few thousand dollars depending on the loan and points.
- Escrows and prepaids. Property taxes are prorated at closing. Lenders often collect several months of taxes and insurance into escrow, commonly enough to cover 2 to 6 months, depending on lender requirements.
- Settlement and recording. Title companies commonly handle closings. Recording and clerical fees are usually modest compared to other items.
How Northern Virginia handles costs
- Recordation and transfer taxes. Virginia uses different terminology and county schedules. Local custom in many Northern Virginia markets is for the seller to pay certain conveyance taxes, but allocation is negotiated in the contract.
- Title insurance and settlement. Title companies and closing attorneys handle searches and settlement. Owner’s policy premiums are tied to the purchase price, often in a similar range to Maryland. The lender’s policy is separate.
- Escrows, prepaids, and prorations. Taxes and HOA dues are prorated. Lenders typically collect initial escrow deposits for tax and insurance.
- Additional local fees. Some localities have supplemental fees, and HOA or condo transfer or estoppel fees can be meaningful for condos and townhomes.
Maryland vs. Virginia: key differences
- Terminology. Maryland references transfer and recordation taxes. Virginia references recordation taxes and often a grantor’s tax in some areas.
- Who typically pays. In many suburban deals on both sides of the river, sellers commonly pay some transfer or conveyance taxes, but it is contract-specific and negotiable.
- Absolute dollars. With higher home values, percentage-based items like title insurance and transfer taxes can add up. Exact amounts depend on statutory rates and local schedules.
- HOA and condo fees. Expect HOA transfer or estoppel fees to show up in both states, especially for condos and townhomes.
- Process. Title companies or closing attorneys handle most settlements in both states. Your deed and mortgage record with the county after closing.
What buyers usually pay
While every contract is different, buyers commonly cover:
- Lender-required fees. Appraisal, credit report, origination, underwriting, and any discount points.
- Lender’s title policy. The owner’s policy can be a negotiation point between buyer and seller.
- Prepaids and escrows. Homeowner’s insurance and initial tax and insurance reserves, plus prorated taxes and HOA dues from the closing date forward.
- Share of title and settlement fees. How these are split varies by agreement. Recording fees are typically modest.
- Inspections and optional items. Survey or wood-destroying insect inspections if required by the lender or requested in the contract.
Seller credits are often used to help with buyer closing costs, subject to lender limits based on loan type.
Quick examples (illustrative only)
These are simplified estimates to help you think through a Bethesda vs. Northern Virginia scenario. Always ask your lender and title company for precise quotes.
Example 1: Bethesda, MD purchase at $800,000
- Owner’s title policy (illustrative): 0.4% of price ≈ $3,200.
- Lender fees and third-party charges: About $1,500 to $4,000, depending on loan structure and points.
- Escrows and prepaids: Several hundred to several thousand dollars for insurance and initial tax escrow, depending on lender requirements.
- Recording/clerical fees: Typically under $200 total.
- Transfer and recordation taxes: Statutory amounts that may total several thousand dollars. Who pays is negotiated; sellers often cover some taxes by local custom, but not always.
Example 2: Northern Virginia purchase at $700,000
- Owner’s title policy (illustrative): 0.4% of price ≈ $2,800.
- Lender fees and third-party charges: Similar categories and ranges as Maryland.
- Escrows and prepaids: Similar mechanics; the amounts vary with taxes, insurance, and lender reserves.
- Recording/clerical fees: Generally modest per document.
- Recordation and transfer taxes: Statutory amounts vary by county. Allocation is negotiated in the contract.
Timeline and disclosures you can expect
- Loan Estimate. Your lender provides this within 3 business days of your loan application. It outlines projected closing costs.
- Closing Disclosure. You receive this at least 3 business days before closing so you can review exact numbers.
- Typical contract-to-close. Many financed purchases close in about 30 to 45 days. Appraisals often take 1 to 3 weeks to schedule and complete.
- Title and recording. Title search and exam are completed during escrow. Deed and mortgage record with the county shortly after closing.
What is negotiable
You can negotiate these items in your offer and counteroffer:
- Who pays transfer or conveyance taxes. Custom varies by neighborhood and price point; the contract controls.
- Seller credits toward closing costs. Useful for lender fees, prepaids, or discount points, within lender limits.
- Who pays for the owner’s title policy and certain settlement fees. Practices vary; title companies can show options on a draft settlement statement.
- Discount points. Whether you buy down the rate or ask for a seller credit to offset points.
Statutory tax rates are set by law. You can negotiate who pays them, not the amounts.
How to prep your budget
- Ask for a sample settlement statement early. Your title company can provide an estimate tailored to the address and contract.
- Request your Loan Estimate promptly. Use it to compare lender fees and understand how points affect your payment and cash to close.
- Get a title insurance quote. Confirm the owner’s and lender’s policy premiums and what the settlement fee includes.
- Plan for prepaids and escrows. Clarify how many months of taxes and insurance your lender will collect at closing.
- Compare both sides of the river. If you are open to Bethesda and Northern Virginia, ask for two estimates so you can see side-by-side differences.
Work with a team that knows both markets
If you are weighing Bethesda against Northern Virginia, you benefit from a partner who understands the local customs and how to structure your contract. Our team helps you model cash to close, line up title and lender quotes, and negotiate credits that fit your goals. When you are ready, connect with The Gaskins Team for local, step-by-step guidance.
Important disclaimer
This is general information only and not legal, tax, or financial advice. Exact amounts and who pays specific items depend on statutory rates, county schedules, lender requirements, and the negotiated purchase contract. Always confirm amounts with the title company, county recorder, and your attorney or tax advisor.
FAQs
Who usually pays transfer taxes in Bethesda vs. Northern Virginia?
- Allocation is negotiable and driven by local custom; in many suburban markets sellers commonly pay some transfer or conveyance taxes, but your contract controls.
How much does title insurance cost on a Bethesda home?
- Title insurance is a one-time premium tied to the purchase price, often expressed as a fraction of price; ask your title company for an exact quote for owner’s and lender’s policies.
Are recording fees a big part of buyer costs in MD or VA?
- Recording and clerical fees are typically modest compared to transfer taxes, title insurance, and lender fees.
What buyer costs are due before closing vs. at closing?
- You often pay for the appraisal and inspections as they occur, while the balance of lender fees, title charges, and prepaids post to your Closing Disclosure and are paid at closing.
What closing items are negotiable across MD and VA?
- Who pays transfer taxes, seller credits toward buyer costs, who pays for the owner’s title policy, certain settlement fees, and loan discount points are typically negotiable.
When will I see my exact closing numbers?
- Your lender must send a Loan Estimate within 3 business days of application and a Closing Disclosure at least 3 business days before closing, and your title company can provide a draft settlement statement earlier on request.
