Closing Costs in Texas
The average closing cost in Texas is $16,012, which is 5.2% of the home price. Texas has no transfer tax, which saves buyers money.
Texas has no state transfer tax on real estate transactions, which keeps one major closing cost category at zero. However, Texas's high property tax rates mean that prepaid property taxes at closing can be a significant expense, especially for closings early in the tax year. Title insurance rates in Texas are set by the state Department of Insurance, meaning the rate is the same regardless of which title company you use — there's no shopping for a better price on the policy itself, only on the additional title company fees.
By BuyAHomeIn Editorial | Updated 2026-03-02 | Sources: Zillow, HUD, Tax Foundation
Avg Closing Costs
$16,012
As % of Price
5.2%
Transfer Tax
None
Attorney Required
No
Closing Cost Breakdown for a $308,212 Home
| Item | Estimated Cost |
|---|---|
| Loan Origination Fee (1%) | $2,466 |
| Appraisal Fee | $500 |
| Credit Report | $50 |
| Title Search & Insurance | $1,541 |
| Transfer Tax | N/A |
| Recording Fees | $150 |
| Home Inspection | $400 |
| Survey | $350 |
| Attorney Fee (optional) | N/A |
| Prepaid Property Tax (2 months) | $699 |
| Prepaid Homeowners Insurance (1 year) | $925 |
| Prepaid Interest (15 days) | $659 |
| Estimated Total | $7,740 |
* Estimates based on average Texas home price of $308,212 with 20% down payment. Actual costs may vary. Transfer tax, attorney fees, and prepaid items are state-specific.
How to Reduce Closing Costs in Texas
No Transfer Tax Advantage
Texas charges no state or local transfer tax on real estate sales. Combined with the homestead exemption, this provides significant savings at the time of purchase.
Apply for Homestead Exemption Immediately
Texas's homestead exemption provides at least $100,000 off your assessed value for school district taxes. File with your county appraisal district immediately after closing — the exemption can save $1,500-3,000+ annually depending on your district's tax rate.
Budget Heavily for Property Taxes
Texas property taxes average 1.6-1.8% of home value but can exceed 2.5% in some suburban school districts. On a $400,000 home, expect $6,400-10,000+ in annual property taxes. This is often the single biggest surprise for relocators from low-property-tax states.
Use TDHCA Down Payment Programs
The Texas Department of Housing and Community Affairs offers the My First Texas Home program with up to 5% of the loan amount in down payment and closing cost assistance. The My Choice Texas Home program extends similar benefits to repeat buyers.
Legal Context for Texas Closings
Conveyance Document
General-warranty or special-warranty deed
Security Instrument
Deed of trust or vendor's lien retained in the deed
Foreclosure Process
Non-Judicial
Attorney Required
No
Texas uses general-warranty or special-warranty deed for property transfers and deed of trust or vendor's lien retained in the deed as the security instrument. While an attorney is not required, you may still choose to hire one.
