Lending
Closing Costs in the Sacramento Region, Explained
What goes into closing costs and cash to close, including Sacramento transfer tax and the supplemental tax bill.
Talk to Maggie directly: cell (916) 549-3131 (text or call) · maggie@loveyoursurroundings.coMaggie B. Hopkins, NMLS #349517 · Surroundings NMLS #2528307
What are closing costs?
Closing costs are the fees and payments due when your loan and purchase close, apart from the down payment. They come from several places: the lender, the title and escrow companies, the county and city, and your own prepaid taxes and insurance.
Your Loan Estimate lists them all on page 2. That form is the same for every lender, so you can compare offers line by line. Our Loan Estimate guide walks through it page by page.
What does the lender charge?
Lender costs show up on page 2 of the Loan Estimate. The CFPB's home loan toolkit (last updated July 2026) points to three sections:
- Section A, origination charges. What the lender or broker charges to make the loan, including any points.
- Section B, services you cannot shop for. Items the lender picks, such as the appraisal and credit report.
- Section C, services you can shop for. Items such as title services, where you may choose the provider.
The toolkit suggests focusing on Sections A and B when comparing lenders. You can shop Section C no matter which lender you use. Section J shows lender credits, which can lower your costs and may raise your rate. More on that trade-off on our rate locks and points page.
What do title and escrow cost, and do you need both?
In California an escrow company usually handles the closing. The CFPB toolkit notes that in several Western states this person is called an escrow agent. Escrow holds the money and documents and makes sure every condition is met before the home changes hands.
Title insurance protects against old claims on the home, such as unpaid taxes or contractors who were never paid. The toolkit explains that most lenders require a lender's title policy, which protects the amount they lent. An owner's policy protects your investment and is listed as optional when the lender doesn't require it.
Title companies may show their fees differently from your Loan Estimate. The toolkit says to compare the bottom-line total of all title-related costs. And the seller can't require you to buy title insurance from a particular company.
What are prepaids and escrow deposits?
These are not fees. They are your own future bills, paid in advance. They often surprise people, so it helps to know them by name:
- Prepaid interest. Interest from your closing date to the start of your first full payment period. The CFPB glossary (last modified December 28, 2022) defines it this way. Closing later in the month means fewer days to prepay.
- Homeowners insurance. The toolkit says it is often paid in advance for the first full year.
- Initial escrow deposit. If your taxes and insurance are paid through an escrow, or impound, account, the lender collects a starting balance. This cushion means the account can pay the bills when they come due.
The CFPB notes these items can change by any amount between the Loan Estimate and closing. That's because insurers and the county set them, not the lender. Our Sacramento property tax calculator helps you estimate the tax side.
How does transfer tax work in Sacramento?
California counties charge a documentary transfer tax when a home sells. The Sacramento County Clerk-Recorder's FAQ (checked October 22, 2026) sets the county rate at $0.55 for each $500 of value, less any loans the buyer assumes. It's paid when the deed records. The county says either the buyer or the seller pays it, by mutual agreement.
Inside City of Sacramento limits there is a second, separate tax. The County Clerk-Recorder's notice on the City's tax (checked October 22, 2026) says it is levied at .00275 of the value of consideration, effective September 1, 2013. That's $2.75 per $1,000 of price.
Who pays which transfer tax is a term in your purchase contract. Ask your escrow officer whether a city tax applies to your address, since rules differ by city.
Can the seller help pay your closing costs?
Often, yes. A seller credit is money the seller agrees to put toward your costs, written into the purchase contract. It can cover lender fees, title and escrow, prepaids or a rate buydown. On your Loan Estimate and Closing Disclosure it reduces your cash to close.
Each loan program limits seller help. VA.gov's funding fee and closing costs page (last updated October 5, 2026) is a clear example. Credits toward closing costs have no limit there. Seller concessions are capped at 4% of the home's reasonable value. It also says that on a VA purchase, the funding fee is the only cost you can finance. Ask the lender for your program's limit before you write the offer.
What is cash to close, and how should you send it?
Cash to close is the total you bring on closing day. It's your down payment plus closing costs, minus your deposit, seller credits and other adjustments. The CFPB's Loan Estimate explainer (modified October 29, 2025) notes it is usually paid by cashier's check or wire, with proof of where the money came from.
Wire fraud targets home buyers. The CFPB's article on closing scams (modified June 25, 2026) gives clear advice. Confirm wire instructions by phone, using a number you got in person or at the start. Never follow wiring instructions sent by email. If something feels off, call your escrow officer at the number you already have before you send anything.
What is the supplemental tax bill, and why does it arrive after you move in?
In California, a sale triggers a new assessment of the home's value. The Sacramento County Assessor's guide to supplemental assessments (checked October 22, 2026) explains the result. A supplemental bill comes in addition to the regular annual bill, and both must be paid.
Three things to know from that guide:
- There's no fixed timeline. The bill may take up to two years to arrive.
- Purchases from January 1 to May 31 can bring two supplemental bills. Purchases from June 1 to December 31 bring one.
- Mortgage servicers do not receive the supplemental bill. It goes to you, so plan to pay it yourself.
Set money aside for it after closing. Our property tax calculator can help you estimate your new yearly tax.
How do you start getting a clear closing cost picture?
Fill out the loan options form or call Maggie's cell at (916) 549-3131. Maggie will show you each option's closing costs, credits and cash to close in dollars. Bring any other lender's Loan Estimate and we'll compare it line by line. The mortgage process page shows when each cost comes up.
Frequently Asked Questions
What is the transfer tax in Sacramento County?
The Sacramento County Clerk-Recorder lists $0.55 per $500 of value, less loans assumed. Inside City of Sacramento limits, a separate City tax of .00275 of the price also applies. Who pays is set in your contract.
What is a supplemental tax bill?
A separate California property tax bill after a sale, based on the new assessed value. The Sacramento County Assessor says it can take up to two years to arrive and goes to you, not your mortgage servicer.
Can closing costs go up after my Loan Estimate?
Some can. The CFPB says lender and broker fees and transfer taxes generally can't rise without a change in circumstances. Some third-party fees can rise up to 10% in total. Prepaids and escrow deposits can change by any amount.
Do I need owner's title insurance?
It's usually optional. The CFPB toolkit says most lenders require a lender's policy, and an owner's policy protects your own investment in the home. Ask your escrow or title officer what it covers.
How do I avoid wire fraud at closing?
Confirm wire instructions by phone with a number you got in person or at the start. The CFPB says never follow wiring instructions in an email.
Can the seller pay my closing costs?
Often, through a seller credit written into the contract. Each loan program sets limits, so check yours before you write the offer.
Talk to Maggie directly: cell (916) 549-3131 (text or call) · maggie@loveyoursurroundings.coMaggie B. Hopkins, NMLS #349517 · Surroundings NMLS #2528307
Loans are arranged through Maggie B. Hopkins, NMLS #349517 · Surroundings NMLS #2528307. This is not a commitment to lend. All loans subject to credit approval and property qualification. Equal Housing Lender.
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