Average Closing Costs by Lender
Closing costs vary by lender more than most borrowers realize. The federal HMDA dataset — which covers millions of purchase mortgages each year — shows that median total loan costs can differ by $2,000 or more between lenders in the same market. Here's what the data reveals and how to use it when shopping for a mortgage.
What counts as closing costs in HMDA data
HMDA records 'total loan costs' as reported on Page 2 of the Closing Disclosure. This includes: origination charges (Section A), services you cannot shop for (Section B), and services you can shop for (Section C). It does not include prepaid items like homeowner's insurance, property tax escrow, or prepaid interest — those are not lender-controlled costs.
This definition is narrower than the cash-to-close figure on Page 3 of your Closing Disclosure, but it's the most useful number for comparing lenders, because it captures the fees that are actually under the lender's influence.
How median costs vary across lenders
Among lenders with 500 or more purchase originations nationally, median total loan costs typically range from roughly $3,500 to over $8,000. The spread is widest in high-cost states like New York, California, and New Jersey, where title insurance and attorney fees add substantially to the baseline.
Credit unions and direct-to-consumer lenders (those that originate and hold or sell loans directly) often appear lower on cost rankings than broker-heavy or correspondent channels. But lender type is not a reliable predictor of cost — there are expensive credit unions and cheap broker-sold loans. Look at the actual data for your state and loan type.
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Why you should compare Loan Estimates, not just rankings
Lender rankings tell you where to look, not what to pay. Once you identify low-cost lenders in your market, you need an actual Loan Estimate to compare your specific scenario. Rankings are based on median costs across all borrowers — your actual costs will vary based on loan size, credit score, down payment, and property type.
Request Loan Estimates from your top 3-5 lenders on the same day. Rates and fees change daily. Comparing estimates issued a week apart means you're not comparing the same product. The 3-page standardized format makes it straightforward to calculate total cost of each offer.
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