Wondering how much cash you need beyond your down payment to buy in Novato or San Rafael? You are not alone. Closing costs can feel opaque, especially in Marin where prices and fees are higher than average. In this guide, you will learn what buyer closing costs include, how much to budget, who typically pays what, and how to plan your funds with confidence. Let’s dive in.
What closing costs cover
Closing costs are the non‑down‑payment fees and prepaid items you pay to complete your purchase and fund your mortgage. They include lender charges, escrow and title services, inspections, prepaid taxes and insurance, and recording or assessment fees. In California and Marin County, a practical baseline is to plan for about 2% to 5% of the purchase price, recognizing that higher local prices mean larger dollar amounts even if the percentage is similar. Several items are negotiable, and exact figures will appear on your lender’s Loan Estimate and final Closing Disclosure.
Loan costs to expect
Loan fees are charged by your lender or tied directly to your mortgage. You typically pay these as the buyer.
- Loan origination, processing, and underwriting fees. These may be quoted as a flat fee or as a percentage of the loan amount, often about 0.5% to 1.5% of the loan.
- Discount points. Optional points equal 1% of the loan per point to lower your interest rate. You or the seller can pay points if negotiated.
- Appraisal. Most loans require an appraisal. In the Bay Area this often ranges from several hundred dollars to over $1,000.
- Credit report, flood certification, tax service, and automated underwriting fees. These are small fixed items, commonly $25 to $200 each.
- Mortgage insurance and program costs. If your program requires mortgage insurance, you may pay an upfront premium at closing.
- Prepaid interest. You pay interest from the funding date to the start of your first mortgage payment. The amount depends on your closing date and rate.
- Initial escrow or impound deposits. Many lenders require you to fund a starting cushion for property taxes and homeowners insurance.
Title, escrow, and recording
Title and escrow companies handle the transfer, insure the title, and coordinate funds. Who pays what can vary by contract in Marin.
- Lender’s title insurance policy. Required by most lenders and commonly paid by the buyer.
- Owner’s title insurance policy. In many California transactions the seller pays, but this is negotiable and should be confirmed in your contract.
- Escrow or settlement fees. These often scale with price and are frequently split between buyer and seller in California, though the split is negotiable.
- Recording fees and county charges. Buyers usually pay to record the deed of trust and other lender documents with the county.
- Documentary transfer tax. This tax, if applicable, is often paid by the seller in many jurisdictions. Confirm local practice for Marin County or any city‑level taxes.
Prepaids and reserves
Prepaids are not fees but upfront funding of ongoing costs. Your lender and escrow will calculate the exact amounts.
- Property tax prorations. Taxes are prorated from the closing date forward. California taxes include a 1% base rate plus voter‑approved assessments.
- Homeowners insurance. Lenders typically require proof of coverage and payment of the first year’s premium at closing.
- Escrow account deposits. Expect several months of tax and insurance payments to establish your impound account.
- HOA dues and transfer items. If applicable, you will pay prorated dues from the closing date. The HOA may charge resale, transfer, or document fees.
Inspections and repairs
Inspections help you understand condition and plan for repairs. Buyers typically pay these costs.
- General home inspection. Pricing varies by size and complexity and is often several hundred dollars in Marin.
- Pest inspection. Termite inspections are common in California. Repair responsibilities are negotiable.
- Specialty inspections. Sewer lateral scope, roof, chimney, foundation, septic or well, and environmental checks can be prudent depending on the property.
- Repair escrows or holdbacks. If repairs are agreed upon, funds may be held in escrow per your contract.
HOA and assessments
If you are buying a condominium or a home in a planned community in Novato or San Rafael, review HOA costs early.
- Estoppel or resale disclosure fees. These may be charged to either party and can range from about $150 to over $500.
- Special assessments and parcel taxes. Marin properties may include voter‑approved parcel taxes or special assessments that appear on annual tax bills and are prorated at closing.
- Mello‑Roos. Less common in Marin than in some other parts of California, but confirm for your property and review all disclosures.
Who pays what in Marin
California customs are flexible and often shaped by market conditions. Your purchase agreement will state who pays each item.
- Buyers typically pay lender fees, appraisal, credit report, the lender’s title policy, recording related to the new loan, inspections, prepaid interest, initial escrows, and homeowners insurance.
- Sellers often pay the owner’s title insurance policy, any transfer taxes imposed on the seller, payoff of their existing loan, broker commissions, and a portion of escrow fees if agreed.
- Escrow and some title fees are frequently split, but the split can be negotiated.
- In competitive seller’s markets, buyers may assume more costs to strengthen offers. In buyer‑friendly markets, seller concessions are more common.
Key timing and documents
Understanding the timeline helps you avoid surprises and last‑minute cash crunches.
- Loan Estimate. Your lender must provide this within 3 business days of your loan application. It shows an itemized estimate of loan and closing costs.
- Closing Disclosure. You must receive this no later than 3 business days before closing. It is the final accounting of your charges.
- Title and escrow reports. Preliminary title reports and escrow instructions are issued during contingencies and will outline anticipated title and escrow charges.
- Tolerance rules. Certain lender fees are limited in how much they can increase between the Loan Estimate and Closing Disclosure. Compare both documents carefully.
Marin tax tips
Marin’s property tax structure and local assessments affect what you pay at and after closing.
- Property tax base. Expect the statewide 1% base rate plus voter‑approved local assessments. These are prorated at closing.
- Supplemental tax bills. After your purchase, you may receive a supplemental bill if the assessed value changes. Your title company and the assessor can help you estimate timing and amount.
- City and county fees. Recording fees and any county or city transfer taxes should be verified with the Marin County Recorder and noted in your contract.
Budget example
The numbers below are illustrative only to show how costs can add up. Always rely on your Loan Estimate and Closing Disclosure for exact figures.
Assumptions: Purchase price $1,000,000; 20% down; $800,000 loan.
- Lender fees and points: 0.75% of loan = $6,000
- Appraisal: $700
- Credit report, tax service, and misc lender fees: $300
- Lender’s title policy: $1,200
- Escrow fees, buyer portion: $1,250
- Recording fees: $150
- Prepaid interest (example): $2,000
- Initial escrow deposits: $3,000
- Home inspection and pest: $800
- HOA transfer or estoppel (if applicable): $300
- Notary, wire, and courier: $200
Estimated buyer cash to close for costs only: about $15,900, which is roughly 1.59% of price, plus your down payment. If you choose to buy points, fund larger reserves, or add services, totals can reach 2% to 4% or more.
Ways to reduce costs
You have options to manage out‑of‑pocket costs without derailing your purchase.
- Negotiate seller concessions. Ask for credits toward closing costs, keeping offer competitiveness in mind.
- Roll costs into the loan. If allowed by your program and loan‑to‑value, you can finance some costs, which increases your monthly payment.
- Shop lenders. Compare Loan Estimates from multiple lenders. Fees and rates vary.
- Ask for lender credits. Some lenders offer credits in exchange for a slightly higher interest rate.
- Negotiate title and escrow splits. Request that the seller pay the owner’s title policy or a larger share of escrow fees if market conditions allow.
- Explore assistance programs. First‑time buyers should check state or local programs for closing cost help and eligibility requirements.
Buyer checklist
Use this quick list to stay organized from offer to close in Novato or San Rafael.
- Ask your lender for a Loan Estimate as soon as you apply.
- Request a fee sheet from your chosen escrow and title company.
- Confirm in writing who pays the owner’s title policy, transfer taxes, and escrow split.
- Verify HOA dues, transfer, and document fees early if buying a condo or in an HOA.
- Schedule a home inspection, pest inspection, and any specialty inspections.
- Review your preliminary title report for assessments and easements.
- Compare your Closing Disclosure to your Loan Estimate and ask questions.
- Confirm wire instructions directly by phone with escrow before sending funds.
Ready to run the numbers together?
If you want tailored estimates for a specific Novato or San Rafael home, my team will walk you through every line item and strategy to keep cash to close in check. For calm, concierge‑level guidance from offer to keys, connect with Carla Giustino to request a complimentary Marin market consultation.
FAQs
How much should a Novato buyer budget for closing costs?
- Plan for about 2% to 5% of the purchase price for buyer closing costs, then confirm exact figures with your lender’s Loan Estimate and your Closing Disclosure.
What are mandatory versus optional buyer fees in Marin?
- Mandatory costs include lender‑required fees, title services required by the lender, government recording, and prepaids; optional items include discount points, home warranties, and some additional inspections.
Who usually pays the owner’s title insurance policy in Marin County?
- In many California transactions the seller pays the owner’s policy, but it is negotiable and should be clarified in your contract for Novato or San Rafael.
How do Marin property taxes and supplemental bills affect buyers?
- Taxes are prorated at closing and you may receive a supplemental bill after purchase due to a change in assessed value; your title company and the assessor can estimate timing and amount.
Can a seller in San Rafael pay my closing costs?
- Yes, you can negotiate seller credits toward your closing costs, although market conditions and offer strength will influence what is feasible.
When will I receive my Loan Estimate and Closing Disclosure?
- You must receive the Loan Estimate within 3 business days of applying and the Closing Disclosure no later than 3 business days before closing.
Are HOA fees and transfer charges common for Novato condos?
- Many Novato and San Rafael condos and planned communities have monthly dues and may charge resale or transfer fees, which should be verified early and included in your budget.
