What are the main closing costs when refinancing in Pennsylvania?

Refinance closing costs in Pennsylvania fall into four standard categories: lender charges in Section A (origination, application, processing, underwriting), third-party services in Sections B and C (appraisal, credit report, title), prepaids in Sections F and G (taxes, insurance, prepaid interest), and government recording fees in Section E. The state has no mortgage recording tax and no transfer tax on refinances, which keeps the bill closer to the national average than in higher-tax states.

Do I pay transfer tax on a refinance in Pennsylvania?

No — Pennsylvania exempts refinances from transfer tax. Transfer tax applies when property changes hands, not when the loan changes. The closing agent should not include any transfer tax line on a refinance LE in Pennsylvania; if one appears, push back.

Is title insurance discounted on a refinance in Pennsylvania?

Yes — title insurance reissue rates are generally available on refinances in Pennsylvania. The discount is typically 30 to 70 percent off the standard lender's policy premium when the prior title work is recent enough to qualify. The catch: the borrower usually has to ask. Closing agents do not always apply the reissue rate automatically — request it in writing before closing.

How much can I save by negotiating refinance closing costs in Pennsylvania?

Most Pennsylvania refinance borrowers save $500 to $2,500 by actively negotiating lender fees and shopping title — and often more on larger loans. The largest single source is the origination charge in Section A, which is typically negotiable by 25 to 50 percent against a competing Loan Estimate. Title and settlement services in Section C can usually be shopped for additional savings.

Refinance Closing Costs in Pennsylvania: Rules & Fees

Overview

Refinancing in Pennsylvania is among the simpler closings in the country. The state does not levy a mortgage recording tax, refinances are exempt from transfer tax, and attorneys are not required. Most of the bill is the same standard lender and title charges that apply nationwide.

Title insurance reissue rates are available on most Pennsylvania refinances and typically discount the lender's title policy by 25 to 50 percent compared to the standard rate. The catch: borrowers usually have to ask. Closing agents do not apply the discount automatically.

Below: where the negotiable savings actually live on a Pennsylvania refinance, the title reissue discount to request, and the patterns we see most often on Pennsylvania Loan Estimates.

One Pennsylvania-specific pattern worth flagging in advance: high filed title insurance rates. The detailed callouts further down cover the mechanics. Worth knowing: PA has NO mortgage recording tax and NO transfer tax on refinances. Refinances are tax-free at the state and local level on the loan side. High refinance closing costs in PA come from TIRBOP-filed title insurance premiums and per-county recording fees — not from taxes on the mortgage or refinance. Title underwriters active in the state include TIRBOP-filed rates apply to all major underwriters in PA.

Where the audit fits

On a typical Pennsylvania refinance, lender fees in Section A are where the most negotiable money lives — origination, processing, underwriting. Fair Loan Check Full Analysis ($39) benchmarks each line item against current market data, drafts a counter-offer email, and flags the Pennsylvania-specific patterns most likely to be inflated. Most borrowers save 3x to 5x what the audit costs.

Mortgage recording tax

Pennsylvania does not levy a mortgage recording tax. The new loan amount on a refinance does not trigger any state or county tax in Pennsylvania.

Transfer tax on refinance

Pennsylvania exempts refinances from transfer tax. Transfer tax applies when property changes hands, not when the loan changes. Refinances are NOT subject to PA's notoriously high realty transfer tax. Common consumer confusion since the transfer tax is famously high in PA — but it only applies to property sales.

Exemption statute: 72 P.S. § 8102-C; 61 Pa. Code § 91.193. PA Realty Transfer Tax (1% state + ~1% local; Philadelphia 3.578% city + 1% state = 4.578%) applies to deeds and certain long-term leases that transfer real property. Mortgages and refinances do not transfer title and are not subject to PA realty transfer tax.

Title insurance reissue rate

PA title insurance rates are filed by TIRBOP (rate-bureau state). Reissue rate available on owner's policy when prior owner's policy provided. Refinance rate (lender's policy on a refinance) is offered at a substantial discount off basic rate. PA's basic rate is among the highest in the nation, so the dollar value of the refinance discount is large.

Typical discount on the lender's policy: 25–50% off (typical 35%).

Lookback period: Reissue: prior owner's policy within 10 years (TIRBOP rule). Refinance rate on lender's policy: typically requires prior policy within 10 years.. Documentation required: Copy of prior owner's or lender's title policy..

PA is a rate-bureau state — premium is the same across underwriters. Borrowers should focus on confirming the refinance rate / reissue rate is applied, and on shopping ancillary title services and settlement fees.

Pennsylvania refinance gotchas

Patterns we see consistently on Pennsylvania refinance closings, sorted by how actionable they are:

Sources

72 P.S. § 8101-C et seq. (PA Realty Transfer Tax Act)
61 Pa. Code § 91.193 (excluded transactions)
PA Department of Revenue — Realty Transfer Tax
Philadelphia Code § 19-1400 et seq. (Phila Realty Transfer Tax)
TIRBOP (Title Insurers Rating Bureau of PA) Rate Manual
LodeStar 2024 Refinance Closing Cost Report (PA among top 5 highest-cost states for refinances)

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Refinancing in Pennsylvania? Here's what you'll actually pay.