Guide · North Carolina
North Carolina closing costs: a line-by-line worksheet for buyers
Work out your North Carolina cash to close line by line: who pays the deed excise tax, the coastal counties with an extra transfer tax, loan fees, prepaids, and where NCHFA help applies.
Build your cash-to-close number in five passes: money you pay before closing, your down payment, loan fees, prepaid taxes and insurance, then credits. In North Carolina the seller pays the state deed excise tax of $1 per $500. Seven northeastern counties add a 1% local transfer tax. NCHFA's 3% or $15,000 assistance and city programs then cover part or all of what's left.
How to use this worksheet
Grab your Loan Estimate, a pencil and the listing price you're aiming for. Go through the five passes below in order. At the end you'll have a rough cash-to-close number to take to your lender. Your Loan Estimate and, later, your Closing Disclosure give the real figures.
Pass 1: Money you pay before closing
These leave your account weeks before closing day:
- Due diligence fee, paid to the seller when the contract is signed
- Earnest money, held in trust
- Home inspection and any specialty inspections
- Appraisal, if your lender collects it up front
The fee and the earnest money are credited back to you at closing, so they count toward your total. Inspection costs usually don't come back. Write each amount down, because you'll use it again in Pass 5.
Pass 2: Your down payment
Your loan type sets the minimum:
| Loan | Minimum down | Note |
|---|---|---|
| FHA | 3.5% of the adjusted value | Needs a 580+ score for that minimum; NCHFA asks for 640 |
| VA | None for eligible buyers | No monthly mortgage insurance |
| USDA guaranteed | None on an eligible property | Loan can include the guarantee fee |
| Conventional (NCHFA) | Your lender confirms | Runs through Fannie Mae HFA Preferred or Freddie Mac HFA Advantage |
Pass 3: Loan fees
Your Loan Estimate lists the lender's charges. On top of those, government-backed loans add one upfront fee each:
- FHA upfront mortgage insurance: 1.75% of the base loan. You can finance it or pay it in cash.
- VA funding fee: 2.15% on a first-use purchase with less than 5% down. It can be financed. Veterans who receive service-connected disability compensation don't pay it.
- USDA guarantee fee: capped by federal rule at 3.5% of the loan. Your lender confirms the current rate.
Then add third-party costs: the closing attorney's fee, the title search, the lender's title insurance policy, an owner's policy if you want one, and recording fees.
Pass 4: Taxes, stamps and prepaids
Deed excise tax (revenue stamps)
Under G.S. 105-228.30, North Carolina charges $1 for each $500 of the price, or part of $500. The law says the transferor, which is the seller, pays it to the register of deeds before the deed is recorded. On a $300,000 home that's $600, and it comes off the seller's side, not yours.
The extra 1% in seven counties
Camden, Chowan, Currituck, Dare, Pasquotank, Perquimans and Washington counties also charge a local land transfer tax of $1 per $100, about 1% of the price, per Perquimans County. Dare County lists it as a second stamp next to the state one. The county pages don't say which side pays. Ask your closing attorney how your contract handles it before you sign.
Prepaid property tax and insurance
North Carolina property taxes are due September 1 and past due January 6. The closing attorney splits the year's bill between you and the seller by closing date. Your lender will also want the first year of homeowners insurance paid and may start an escrow account with a few months of taxes and insurance. On the coast, add wind and flood coverage if needed.
Pass 5: Subtract credits and assistance
Now take away the money that comes back to you or is paid for you:
- Your due diligence fee and earnest money from Pass 1
- Any seller-paid costs in your contract (VA caps seller concessions at 4% of reasonable value)
- Your down payment assistance
NCHFA gives you two choices, and you can't take both:
- NC Home Advantage Mortgage: up to 3% of the first-mortgage loan amount
- NC 1st Home Advantage Down Payment: $15,000 for first-time buyers, qualifying veterans and buyers in targeted census tracts, usable for the down payment, mortgage insurance and closing costs
Cash back to you at closing is capped at $2,500, and it can only come from your own verified out-of-pocket payments.
A worked example
Example numbers only. A first-time buyer in Wake County buys a $280,000 home with FHA and the $15,000 option:
| Item | Amount |
|---|---|
| Minimum FHA investment (3.5% of $280,000) | $9,800 |
| Base loan (96.5%) | $270,200 |
| FHA upfront mortgage insurance (1.75%), financed | $4,728.50 added to the loan |
| NC 1st Home Advantage Down Payment | $15,000 |
| Left over after the $9,800 down payment | $5,200 toward closing costs and prepaids |
If the buyer's closing costs and prepaids came to more than $5,200, they'd pay the difference. If less, the buyer could get back money they paid early, up to the $2,500 cap. The 3% option on the same loan would come to roughly $8,100 to $8,250, depending on whether the financed fee is counted in the loan amount, so for this buyer the $15,000 option goes further.
Where local help fits
City programs can stack on top. House Charlotte, Raleigh, Durham, Greensboro and Concord each run their own help, with their own price and income caps. Some want your own cash in the deal: Durham and Concord each ask for at least $1,000 from the buyer.
Once you have a rough number, check your eligibility to see which assistance you can count in Pass 5.
Reader questions
Who pays the excise tax on a house sale in North Carolina?
The seller. G.S. 105-228.30 sets the tax at $1 per $500 of the price and says the transferor pays it to the register of deeds before the deed is recorded.
Which North Carolina counties have an extra land transfer tax?
Camden, Chowan, Currituck, Dare, Pasquotank, Perquimans and Washington. Each charges $1 per $100 of the price, about 1%, on top of the state excise tax. Ask your attorney who pays it under your contract.
Can the $15,000 NC 1st Home Advantage cover closing costs?
Yes. It can be used for the down payment, mortgage insurance and closing costs. You must use the full $15,000, and cash back to you is capped at $2,500 from your own out-of-pocket payments.
How are property taxes handled at a North Carolina closing?
The closing attorney splits the year's tax bill between buyer and seller by closing date. Taxes are due September 1 and past due January 6, so your closing date changes the split.
Other guides in this series
- How the North Carolina offer to purchase and due diligence period work
- How an attorney closing works in North Carolina
- NCHFA's 3% or $15,000 down payment help: how to choose and stack it
- Charlotte, the Triangle or the Triad: comparing first-home costs
- Buying near Fort Bragg or Camp Lejeune: a checklist for military buyers
- Setting up hurricane, wind and flood insurance on the North Carolina coast
- North Carolina property taxes on a first home, step by step
- North Carolina's Homes for Heroes bill: where it stands and what to use now
- Buying a manufactured home in North Carolina with down payment help
