In Louisiana, both sides pay closing costs, but the split is lopsided. Buyers typically shoulder 3% to 5% of the purchase price in lender charges, title insurance, recording fees, and prepaid items, while sellers pay the agent commissions, pay off their existing mortgage, and cover whatever it takes to deliver clean title. Almost every line item is negotiable in the purchase agreement, so who actually writes the check for any given fee often comes down to what the two sides agreed to when the offer was signed.
One Louisiana quirk sits on top of all of this. State law requires the sale to be executed as an authentic act before a notary, and in Louisiana that notary must also be a licensed attorney. The same person drafts the act of sale, coordinates the title search, prepares the closing disclosure, disburses the funds, and records the documents at the parish clerk of court. Attorney/notary fees for a standard residential closing in the Baton Rouge and New Orleans metro areas generally run $500 to $800. Who pays is negotiable, but the buyer usually covers it because the buyer’s lender requires certified clear title before funding the loan.
What the Seller Pays
Louisiana law obligates a seller to deliver the property and guarantee the buyer’s ownership and peaceful possession.1Louisiana State Legislature. CC 2475 – Seller’s Obligations of Delivery and Warranty Translated into closing-table dollars, that means the seller pays whatever is needed to send the buyer out the door with a clean title.
- Agent commissions. Historically the seller paid both the listing agent and the buyer’s agent, typically 5% to 6% of the sale price combined. Since August 2024, industry rules no longer require the seller to offer compensation to the buyer’s agent through the MLS. Sellers can still agree to cover the buyer’s agent, and many do to attract offers, but it is now a negotiation point rather than an automatic expense.
- Mortgage payoff and release. The seller pays off the remaining principal and accrued interest on the existing loan through the closing date. The lender charges a payoff statement fee, and the parish clerk charges to cancel the old mortgage from the public records. Single mortgage cancellations at the parish level generally run $30 to $70.2St. Tammany Clerk of Court. Recording Fees
- Title clearing. If the title search turns up liens, judgments, or other defects, the seller pays to resolve them. A simple release might cost a nominal filing fee; an unresolved judgment can run into thousands.
- Prorated property taxes. Louisiana taxes are paid in arrears, so the seller owes the buyer a credit for the portion of the year the seller lived in the home.
On a $253,000 sale with a 5.5% combined commission, agent fees alone come to about $13,900. Add the payoff administration, cancellation recording, and tax proration, and total seller costs commonly reach 7% to 9% of the sale price.
What the Buyer Pays
The buyer’s side of the closing statement is longer, mostly because the lender is attached to the transaction.
Lender Fees
The loan origination fee covers processing and underwriting and typically runs 0.5% to 1% of the loan amount, so $1,000 to $2,000 on a $200,000 loan. Expect separate charges for the credit report and, in Louisiana especially, a flood zone determination. The determination matters here more than elsewhere because large parts of the state sit in FEMA-designated flood zones, and a positive finding triggers a mandatory flood insurance policy.
Appraisal, Survey, and Inspections
Lenders require an appraisal to confirm the property is worth the loan amount; a standard single-family appraisal in Louisiana runs $400 to $600. Many lenders also require a boundary survey, roughly $400 to $800 depending on lot size, though a recent subdivision plat sometimes satisfies the requirement. A general home inspection ($300 to $425) is not legally required, but it is money well spent, and a separate termite or wood-destroying insect report ($75 to $150) is commonly required by the lender. Who pays for the termite report is itself negotiable.
Recording Fees
After signing, the closing attorney records the act of sale and the new mortgage at the parish clerk of court. Louisiana sets the fee by page count: $100 for one to five pages, $200 for six to twenty-five pages, and $300 for twenty-six to fifty pages.3Justia Law. Louisiana Revised Statutes Title 13 RS 13-844 – Fees of Ex Officio Recorders A typical closing records at least two documents, so total recording charges usually land between $200 and $400.
Title Insurance
Title insurance comes in two separate policies. A lender’s policy protects only the bank’s interest and is required by virtually every mortgage lender. An owner’s policy protects the buyer’s equity and is optional but strongly recommended, because a defect that surfaces years later can wipe out your investment with nothing to fall back on.4Consumer Financial Protection Bureau. What Is Lender’s Title Insurance?
Louisiana regulates title insurance premiums through a statewide rate schedule, so the price is the same at every title company. Owner’s policy rates run $5.40 per thousand on amounts between $12,001 and $50,000, $4.80 per thousand from $50,001 to $100,000, and $4.50 per thousand from $100,001 to $500,000. Lender’s policy rates are slightly lower. On a $253,000 purchase with a $200,000 loan, that works out to roughly $1,230 for the owner’s policy and about $770 for the lender’s policy.5Virtual Underwriter. Manual of Rates and Forms for Title Insurance in the State of Louisiana The buyer typically pays both premiums, though the owner’s policy is sometimes negotiated onto the seller.
Prepaid and Escrow Items
Beyond fees for services, buyers fund several prepaid items at closing. These are not really “costs” in the sense of money lost; they are expenses you would owe anyway, just paid up front.
- Prepaid interest. Mortgage interest from the closing date through the end of that month is collected at closing. Close on the 10th and you pay roughly 20 days of interest; close later in the month and you pay less.
- Homeowner’s insurance. Lenders require a full year’s premium paid in advance and the policy in force on the closing date. A separate flood policy is required up front for properties in a flood zone.
- Escrow setup. Federal rules let the lender collect an initial escrow deposit for upcoming tax and insurance payments plus a cushion of up to two months. On a home with $3,000 in annual taxes and $1,800 in annual insurance, the initial deposit can add $1,000 to $2,500 depending on where in the calendar year you close.6Consumer Financial Protection Bureau. Section 1024.17 Escrow Accounts
Prepaid items can easily add $3,000 to $5,000 on top of other buyer costs, which is why total cash to close often surprises first-time buyers.
How Prorations Work
Louisiana property tax bills arrive toward the end of the year and cover January 1 through December 31, with payment due by December 31.7Louisiana State Legislature. RS 47-2127 – Time for Payment; Interest and Penalty; Notification Because the seller lived in the home for part of that tax year, the closing attorney calculates a daily rate and credits the buyer. The buyer then pays the full bill in December.
If annual taxes are $3,000 and the sale closes on September 1, the seller owned the home for 243 days. At about $8.22 per day, the seller credits the buyer roughly $1,997 at the closing table. The buyer later pays the full $3,000 bill and effectively recovers the seller’s share through that credit.
HOA dues work the same way in reverse. If the seller prepaid an annual assessment in January and closing happens in June, the buyer reimburses the seller for the remaining six months. Any utility deposits or fuel left in a propane or heating oil tank can also be adjusted, though those credits are usually small.
Shifting Costs Through Negotiation
Nothing in Louisiana law locks any particular fee to a particular party. The standard residential purchase agreement has blanks for allocating individual closing costs, and in a buyer’s market sellers routinely agree to cover some or all of the buyer’s charges to close the deal. In a seller’s market, buyers sometimes offer to take on expenses the seller would traditionally pay.
The most common tool is a seller concession: the seller agrees to pay a flat dollar amount or percentage of the sale price toward the buyer’s closing costs. The money comes out of the seller’s proceeds and reduces the buyer’s cash to close. It is especially useful for buyers who can qualify for a mortgage comfortably but are short on savings for upfront costs.
Lenders cap how much the seller can contribute, and the ceiling depends on the loan type:
- Conventional loans: 3% of the sale price with less than 10% down, 6% with 10% to 24.9% down, and 9% with 25% or more down.
- FHA loans: up to 6% of the sale price regardless of down payment.
- VA loans: concessions capped at 4% of the property’s reasonable value, though credits applied directly to actual closing costs are not limited.8VA.gov. VA Funding Fee and Loan Closing Costs
- USDA loans: up to 6% of the sale price.
A concession that blows past the cap can force the lender to kill the deal or make the parties renegotiate the price, so the number has to be written into the offer with the right ceiling in mind.
FHA and VA Loans Change the Math
Government-backed loans add costs conventional borrowers do not pay, and in the VA’s case they also restrict what the buyer is allowed to be charged, which pushes certain fees onto the seller.
FHA
FHA borrowers pay an upfront mortgage insurance premium of 1.75% of the loan amount, usually rolled into the loan balance rather than paid in cash. On a $200,000 loan that adds $3,500 to what you owe. An annual mortgage insurance premium, billed monthly, runs for the life of the loan when the down payment is under 10%.
VA
VA borrowers pay a funding fee ranging from about 1.25% to 3.3% of the loan amount depending on down payment and prior VA loan use. Veterans with service-connected disabilities are exempt. The VA also bars borrowers from paying certain fees that conventional borrowers routinely cover: if the lender charges a flat 1% origination fee, the borrower cannot separately pay processing, document preparation, appraisal, escrow, or tax service fees. Louisiana does allow a few state-level exceptions, including recording release fees on refinances, an Orleans Parish document fee on refinances, and flood elevation fees.9VA State Fees and Charges Deviations List. VA State Fees and Charges Deviations List Because the restricted fees still have to be paid by someone, the seller in a VA transaction often ends up covering costs the buyer would normally handle. Building an expected seller contribution into the offer price keeps a VA deal competitive.
When the Seller Is a Foreign Person
One rule flips the usual buyer-pays, seller-pays logic entirely. If the seller is a foreign person or entity, the buyer must withhold 15% of the sale price and remit it to the IRS under FIRPTA.10Internal Revenue Service. FIRPTA Withholding The seller can apply for a reduced withholding certificate ahead of closing if the actual tax liability will be lower, but that paperwork takes time. The closing attorney handles the mechanics, but failing to withhold makes the buyer personally liable for the tax, so this is worth flagging early if any seller in the chain is non-U.S.