Closing Costs in Texas: What Houston Buyers and Sellers Pay

The fastest way to an accurate number is to know which line items show up on a Texas closing statement and which ones you can actually influence. Below is how closing costs work for Houston-area buyers and sellers, from Kingwood and Atascocita to The Woodlands and Katy.

How much are closing costs in Texas for Houston buyers?

Any honest answer starts with "it depends," because buyer costs are driven by your loan. Your lender must provide a Loan Estimate after you apply, and the Consumer Financial Protection Bureau requires lenders to deliver your Closing Disclosure three business days before your scheduled closing. Compare the two line by line: loan term, loan type, loan amount, interest rate, monthly payment, closing costs and cash to close. If anything changed, ask your lender why.

Typical buyer-side items in a Houston purchase include:

• Lender charges: origination or underwriting fees, any discount points you choose, credit report and appraisal fees.
• Lender's title policy: required by most lenders. The Texas Department of Insurance notes that when an owner's policy and a loan policy are issued together, the loan policy is issued at a discounted price of $100. Bought alone, it costs the full premium.
• Escrow or closing fee: charged by the title company and often split between buyer and seller by contract.
• Survey: a new survey, or the seller's existing survey with an affidavit if the contract and title company allow it.
• Option fee and earnest money: not closing costs exactly, but cash you put up early. Earnest money is typically credited toward your purchase at closing.
• Prepaids and escrow deposits: homeowners insurance, flood insurance if you carry it, and an initial deposit for property taxes.
• HOA charges: resale certificate and transfer fees where an association exists. In Kingwood, each village association has its own documents.
• Inspections: general home inspection and any specialty inspections, usually paid before closing. Peaches' home inspection checklist helps you plan.

When you are ready to start shopping, see how Peaches works with Houston home buyers from the first showing through closing day.

Seller closing costs in Texas

Sellers usually pay fewer lender-related charges but have larger single items. Common seller-side costs include:

• Real estate brokerage fees under the listing agreement and anything agreed toward the buyer's broker.
• Owner's title policy if the contract makes it the seller's expense.
• Payoff of existing loans and any liens.
• Share of escrow fees as negotiated.
• Prorated property taxes for the part of the year you owned the home.
• Repairs or credits agreed during the option period.
• HOA documents and any association payoff or transfer charges.

If you are planning a sale, Peaches' seller strategy walks through pricing, prep and negotiation so you can estimate your net before you list. See also seller services.

Who pays closing costs in Texas?

Who pays closing costs in Texas comes down to your loan, your agreements with your brokers and the sales contract. The Texas Real Estate Commission's resale contract (TREC form 20-19, One to Four Family Residential Contract) has check boxes and blanks that settle several of the larger items, so read them closely before you sign.

• Usually the buyer: lender charges, the lender's title policy, appraisal and credit report fees, prepaid insurance, the initial escrow deposit and inspections.
• Usually the seller: payoff of the seller's existing loans and liens, and the brokerage fee owed under the listing agreement.
• Decided in the contract: the owner's title policy (the resale form has a box for Seller's or Buyer's expense, and the Texas Department of Insurance confirms the buyer and seller may negotiate who pays the premium), how the survey is handled, how escrow fees are split and any amount the seller agrees to put toward the buyer's expenses as allowed by the lender.
• Split by the calendar: property taxes for the year, prorated to the closing date.

Because so much is negotiable, two homes at the same price can close with very different costs. Before you write or accept an offer, ask Peaches to walk you through how each of those choices changes your cash to close or your net proceeds.

Title insurance and escrow in Texas: what is fixed and what is not

Texas is different from most states here. According to the Texas Department of Insurance, title insurance premium rates are set by TDI, all title companies charge the same premium for a policy, and you cannot get a discount on the premium. The buyer and seller can negotiate who pays it, and the premium is paid once, at closing.

Escrow and closing fees are not set by the state. TDI says these differ between agents and encourages you to review them and ask for documentation. That means the escrow fee is one of the few title-side costs worth comparing.

Two more Texas facts that keep closing statements simpler than in some states: Texas has no real estate transfer tax (the Texas Constitution bars new ones enacted after January 1, 2016), and there is no state property tax. County clerks still charge recording fees.

Property tax prorations at a Houston closing

Property taxes in Texas are assessed for the calendar year and billed later in the year, so at closing the title company prorates them. The seller typically credits the buyer for the seller's share of the year, and the buyer pays the full bill when it arrives. In many Houston suburbs your tax stack includes a municipal utility district, so the MUD rate matters as much as the county and school rates. Read Peaches' MUD tax guide and, after you close, file your homestead exemption with your county appraisal district. The Texas Comptroller notes that the general deadline to file an exemption application is before May 1, and Peaches' Harris County homestead exemption steps show you how to file. If the appraisal notice you receive later looks too high, a Harris County property tax protest is how you challenge it.

What are realtor fees in Texas?

There is no state-set rate. The Texas Real Estate Commission's Information About Brokerage Services notice tells consumers that brokerage fees are not set by law and are negotiable. Since January 1, 2026, Texas also requires a written agreement with a residential buyer before a showing (or before an offer if no home is shown), and that agreement must state in conspicuous language that broker compensation is not set by law and is fully negotiable.

For sellers, the fee and how it is paid are written into the listing agreement. For buyers, the buyer agreement spells out what your broker will be paid and from what source. Either side can propose terms, and the sales contract can address seller contributions. Before you tour, read Peaches' guide to the Texas buyer representation agreement and her comparison of a showing agreement vs. a buyer representation agreement.

How much commission does a realtor make in Texas?

The honest answer is that it varies with every agreement. Commission is paid to the brokerage, not directly to the agent. Under the Texas Occupations Code, a sales agent may not accept compensation for a transaction from anyone other than their sponsoring broker, so the agent's share depends on the arrangement with that broker. Out of their share, agents typically cover their own business costs. Any number you see quoted as "the Texas rate" is a guess, not a rule.

A typical Texas closing timeline for Houston buyers and sellers

1. Contract signed. The buyer delivers earnest money and the option fee, and the title company named in the contract opens the file.
2. Option period. The buyer inspects and negotiates any repairs or credits. Sellers should expect requests and plan how they want to respond.
3. Title commitment. The title company reports what it found and what must be cleared, such as existing loans or liens, before it can issue policies.
4. Appraisal and loan approval. The lender orders the appraisal and finishes underwriting.
5. Closing Disclosure. The buyer receives it at least three business days before closing. Sellers receive their own settlement statement from the title company.
6. Final walkthrough and signing. Both sides sign, the lender funds the loan, the deed is recorded, and the seller's proceeds are paid out.

Many of the cost decisions above are made in the first week, when the contract sets who pays for the owner's title policy, how the survey is handled and whether the seller contributes toward the buyer's costs. Talk them through before you sign, not after.

Ways to lower closing costs in Houston

1. Compare Loan Estimates from more than one lender within the same window.
2. Ask about escrow fees, since title premiums are fixed but escrow charges are not.
3. Negotiate seller contributions toward your costs in the contract, within your loan program's limits.
4. Use an existing survey if the seller has one and the title company accepts it.
5. Time your closing with your lender's guidance, since the closing date affects prepaid interest.
6. File your homestead exemption promptly to lower future tax bills.

If you are a first-time buyer, Peaches' first-time buyer planning session helps you map cash needs before you start touring.

How much can a seller pay toward a buyer's closing costs?

A Texas seller can agree to pay part of the buyer's closing costs, and the resale contract has a blank for that amount. The buyer's loan program caps how much counts. For a conventional loan that follows Fannie Mae's rules on a principal residence or second home, the limits on these seller and other interested-party contributions are:

• Up to 3% when the loan-to-value ratio is above 90%
• Up to 6% when the loan-to-value ratio is 75.01% to 90%
• Up to 9% when the loan-to-value ratio is 75% or less
• Up to 2% on an investment property at any loan-to-value ratio

Fannie Mae calculates those limits on the lower of the sales price or appraised value, not the loan amount. The money can go toward closing costs and prepaids, and toward HOA assessments for up to 12 months after closing, but it cannot cover your down payment or required reserves. FHA, VA and USDA loans set their own limits, so ask your lender for the cap on your exact loan before you ask a seller for help.

If you are selling, a contribution toward the buyer's costs can sometimes keep a deal together without a price cut. Peaches can run both versions so you see which one leaves you the better net.

Protect your closing funds from wire fraud

Your cash to close is usually paid by cashier's check or wire transfer, and the Consumer Financial Protection Bureau warns buyers to guard those funds against closing scams. Its advice:

• Pick two trusted contacts early, such as your agent and your title or settlement agent, and confirm the closing process and payment instructions with them in person or by phone.
• Never act on wiring instructions from an email. Verify the account name and number by calling a phone number you already have, not one in the message.
• Keep financial details out of email and be careful with links and attachments about your closing.
• Act fast if you are targeted. Call your bank or wire company right away and ask for a wire recall, then file a complaint with the FBI's Internet Crime Complaint Center at ic3.gov.

Get a clear picture before you sign

Whether you are buying or selling in the Houston area, Peaches can walk through the costs on your specific deal and point you to the right lender, title or legal professional when a question needs one. Call (210) 517-0382 or request a consultation.