In a Virginia home sale, both sides pay closing costs, but the bills are split along predictable lines. Who pays closing costs in Virginia comes down to this: the buyer covers the fees tied to the mortgage and the state recordation tax, while the seller covers the grantor tax, any regional transfer fees in Northern Virginia, deed preparation, payoff of existing liens, and the real estate agent commissions. Buyer costs usually land somewhere between 2% and 5% of the purchase price. Seller costs vary more, mostly because commission arrangements are now openly negotiated.
What the Buyer Pays
Most buyer-side charges exist because the buyer is borrowing money and needs to confirm the property is worth what the lender is lending against it. Loan origination fees generally run 0.5% to 1% of the loan amount. The lender-required appraisal usually costs $400 to $600. The settlement fee paid to the attorney or title company handling closing typically falls between $500 and $900.
Other standard buyer charges include the credit report fee, a flood zone certification, the title search, title insurance premiums, and a boundary survey if one is ordered.
The buyer also pays the state recordation tax, which hits twice. On the deed, it’s $0.25 for every $100 of the sale price or the property’s actual value, whichever is greater.1Virginia Code Commission. Virginia Code 58.1-801 – Deeds Generally; Charter Amendments A separate recordation tax at the same rate applies to the deed of trust, calculated on the loan amount rather than the purchase price. On a $400,000 home with a $360,000 mortgage, that’s $1,000 for the deed plus $900 for the deed of trust.
Recording fees paid to the circuit court clerk are small by comparison. A deed or deed of trust of 10 pages or fewer costs $18 to record; 11 to 30 pages costs $32.2Virginia Code Commission. Virginia Code 17.1-275 – Fees Collected by Clerks of Circuit Courts
One number works in the buyer’s favor. Any earnest money deposit paid when the offer was accepted is credited at closing and can be applied toward the down payment, closing costs, or other settlement charges.
Owner’s and Lender’s Title Insurance
Title insurance confuses buyers because there are two separate policies. The lender’s policy is required by the mortgage company and protects only the lender’s interest; it covers the loan balance, shrinks as the loan is paid down, and ends when the loan is paid off or refinanced. The owner’s policy is optional, protects the buyer against defects a title search might miss (unknown liens, forged documents, boundary disputes), covers the full purchase price, and lasts as long as the buyer or their heirs own the home.3Virginia SCC. Virginia Consumer’s Guide for Title Insurance Many title insurers discount the two policies when they’re bought together, and some offer enhanced owner’s policies with an inflation rider.
What the Seller Pays
Seller costs are the costs of transferring ownership and clearing anything owed on the property. The biggest is usually the real estate agent commission, which following industry changes that took effect in 2024 is fully negotiable between the seller and the agent.
The grantor tax is the main state-level transfer tax on the seller’s side. It’s charged at $0.50 per $500 of the sale price, equivalent to $1.00 per $1,000, after subtracting any existing liens the buyer assumes.4Virginia Code Commission. Virginia Code 58.1-802 – Additional Tax Paid by Grantor; Collection On a $400,000 sale with no assumed liens, the grantor tax comes to $400. The statute lets the parties negotiate who pays, but Virginia custom puts it on the seller.
In Northern Virginia, two more regional fees stack on top of the grantor tax. The regional WMATA capital fee adds $0.10 per $100 of the sale price in jurisdictions that are members of the Northern Virginia Transportation Authority.5Virginia Code Commission. Virginia Code 58.1-802.3 – Regional Transportation Improvement Fee The regional congestion relief fee adds another $0.10 per $100 in qualifying planning districts with populations over two million.6Virginia Code Commission. Virginia Code 58.1-802.4 – Regional Congestion Relief Fee Both default to the seller. On a $400,000 Northern Virginia sale, they add $800.
Sellers also pay for deed preparation (the legal drafting of the new deed) and the recording fees for any certificates of satisfaction that release existing mortgages from the land records. Outstanding mortgages and liens must be paid off in full from the seller’s proceeds at settlement so the buyer can take clear title.
In many deals the seller also offers a one-year home warranty for the buyer, typically $350 to $700, as an incentive.
The Virginia Transfer Taxes at a Glance
Because the state’s transfer-related taxes apply at different rates to different parties, it helps to see them side by side:
- Recordation tax (buyer): $0.25 per $100 of value, applied separately to the deed (based on sale price or property value) and the deed of trust (based on the loan amount).1Virginia Code Commission. Virginia Code 58.1-801 – Deeds Generally; Charter Amendments
- Grantor tax (seller): $0.50 per $500 of consideration, after subtracting any assumed liens.4Virginia Code Commission. Virginia Code 58.1-802 – Additional Tax Paid by Grantor; Collection
- WMATA capital fee (seller, Northern Virginia only): $0.10 per $100.5Virginia Code Commission. Virginia Code 58.1-802.3 – Regional Transportation Improvement Fee
- Congestion relief fee (seller, qualifying regions): $0.10 per $100.6Virginia Code Commission. Virginia Code 58.1-802.4 – Regional Congestion Relief Fee
Certain transfers are exempt from some or all of these taxes, including transfers between spouses, transfers to or from governmental bodies, and deeds of gift with no consideration. The full list of exemptions sits in the Virginia Code.7Virginia Code Commission. Virginia Code 58.1-811 – Exemptions
Costs the Buyer and Seller Split
Property taxes and association dues don’t belong fully to either party. They’re prorated by the number of days each one owns the home during the current billing period, and the settlement agent calculates a per-day rate.
If the seller already prepaid taxes covering days after closing, the buyer reimburses the seller for those unused days. If taxes haven’t been paid yet for the period the seller occupied the property, the seller credits the buyer. A $3,650 annual tax bill works out to $10 per day; a closing exactly halfway through the tax cycle leaves each party owing $1,825. The adjustment appears on the settlement statement as a credit to one party and a charge to the other.
HOA or condo dues are prorated the same way. If the seller already paid the current period’s dues, the buyer reimburses for the days left in that period.
Sellers in a community association also owe for the resale certificate, sometimes called the disclosure packet. The association can charge for preparing and delivering this document, with maximum amounts set by the Common Interest Community Board.8Virginia Code Commission. Virginia Code 55.1-2316 – Resale Certificate; Fees These fees, plus any post-closing transfer fees charged by the association, typically fall on the seller and can add several hundred dollars.
When the Seller Agrees to Cover the Buyer’s Costs
Buyers and sellers can rewrite the default split through the purchase contract. A seller concession is just that: the seller agrees to pay some or all of the buyer’s closing costs out of the sale proceeds, which lowers the cash the buyer brings to the table. Concessions are common in buyer-friendly markets or when the seller wants to close quickly.
The buyer’s lender caps how much the seller can contribute, and the cap depends on the loan:
- Conventional loans: 3% of the sale price if the buyer puts down less than 10%, 6% at 10% to 24.99% down, and 9% at 25% or more down.9Fannie Mae. Interested Party Contributions (IPCs)
- FHA loans: 6% of the sale price regardless of down payment, though contributions cannot exceed the buyer’s actual closing costs; any excess triggers a dollar-for-dollar reduction in the appraised value used for the loan.10U.S. Department of Housing and Urban Development. What Costs Can a Seller or Other Interested Party Pay on Behalf of the Borrower?
- VA loans: 4% of the home’s reasonable value as determined by the VA appraisal, a cap that includes items like funding fee credits and prepaid insurance, not just traditional closing costs.11Veterans Affairs – VA.gov. VA Funding Fee and Loan Closing Costs
Concessions have to be written into the purchase contract. They don’t change the sale price; they redirect part of the seller’s proceeds to cover the buyer’s charges.
What’s Negotiable and What Isn’t
The custom-based assignments can be moved. The grantor tax, the two Northern Virginia regional fees, and most settlement services default to one side but can be reassigned by contract. Commission arrangements are now openly negotiated between seller and agent. Seller concessions can shift a portion of the buyer’s financing-related costs onto the seller’s ledger within the lender’s caps.
The arithmetic of the recordation tax and the grantor tax themselves is not negotiable: the rates are set by statute and the taxes are due regardless of which party writes the check. Prorated taxes and HOA dues track the calendar, not preference. And any mortgage or lien recorded against the property has to be paid off from the seller’s proceeds before clear title can pass to the buyer.