Buying in West Hollywood and wondering how much cash you will actually need at the closing table? You are not alone. Closing costs can feel opaque, especially with condos, associations, and local taxes in the mix. In this guide, you will learn what closing costs cover, how they differ for financed and cash buyers, and how to estimate your total with confidence. Let’s dive in.
What closing costs cover
Closing costs are the fees and prepaids required to finalize your purchase. They include services like escrow and title, government recordings, and, if you finance, lender charges. Some items are negotiable, while others are set by third parties or the calendar.
Financed buyers
If you use a mortgage, plan for both loan fees and general transaction costs. A practical rule of thumb is to budget about 2% to 5% of the purchase price for closing costs, depending on your loan type and choices like discount points. You will also pay prepaid interest, initial insurance, and escrow reserves for taxes and insurance.
Cash buyers
If you pay cash, you avoid lender-related fees and a lender’s title policy. Your closing costs are typically lower, often about 0.5% to 2% of the purchase price, driven mainly by escrow, title, recording, and any HOA charges. You still need to budget for inspections and prorations.
Line-item costs in West Hollywood
Escrow and closing fees
Escrow coordinates documents, funds, payoffs, and recording.
- Typical payer: Often split between buyer and seller, but negotiable.
- Cost drivers: Purchase price and escrow company schedule.
- What to budget: A few hundred to a few thousand dollars. Get a quote from a local escrow company.
Title search and title insurance
Title ensures clean ownership and insures against covered defects. If you finance, your lender requires a lender’s policy.
- Typical payer: In many California markets, sellers customarily pay for the owner’s policy, while buyers pay the lender’s policy. All terms are negotiable.
- Cost drivers: Purchase price, loan amount, and endorsements.
- What to budget: Premiums scale with price and loan amount. Ask your title officer for an estimate.
Recording and transfer taxes
Recording fees cover county recording of the deed and loan documents. Documentary and city transfer taxes may apply based on location and price.
- Typical payer: Buyers often pay recording fees. Transfer taxes are commonly paid by sellers in California, but local customs vary and negotiations can change allocations.
- Cost drivers: Number of documents and any city or county tax rates.
- What to budget: Recording is typically a few hundred dollars. Confirm any city or county transfer taxes early.
Lender and loan fees (for mortgages)
These include origination, processing, underwriting, credit report, appraisal, flood cert, and any discount points.
- Typical payer: Buyer.
- Cost drivers: Lender pricing, loan program, credit profile, and whether you buy points.
- What to budget: Origination may be 0% to 1% of the loan amount; each discount point is 1% of the loan. Appraisals often range from about $400 to over $1,000.
Prepaid items and escrow reserves
These are upfront charges for property taxes, homeowner’s insurance, and daily interest, plus initial deposits for your lender’s escrow account.
- Typical payer: Buyer.
- Cost drivers: Closing date, tax cycles, insurance premium, and lender escrow rules.
- What to budget: Several months of taxes and insurance, which can add up to a few thousand dollars.
Mortgage insurance and program fees
Depending on your loan, you may have PMI, FHA upfront mortgage insurance premium, or a VA funding fee.
- Typical payer: Buyer.
- Cost drivers: Down payment, loan type.
- What to know: PMI is paid monthly on many loans with less than 20% down. FHA and VA include one-time upfront charges that can be paid at closing or financed, depending on the program.
HOA and condo charges
West Hollywood has many condos, which often include association-related fees at closing.
- Possible items: HOA estoppel or resale disclosure, transfer fees, first month’s dues, move-in fees, and any outstanding special assessments.
- Typical payer: Varies by association and contract; some fees are seller-side, others charged to the buyer.
- What to budget: Estoppel or resale disclosure commonly $150 to $500. Move-in or transfer fees vary widely, from under $100 to several hundred dollars.
Inspections and reports
Buyers typically order due diligence inspections.
- Common items: General home inspection, pest inspection, and specialized inspections as needed.
- What to budget: Home inspection about $300 to $800. Pest inspections about $100 to $300. Specialty inspections vary by scope.
Holdbacks and assessments
In certain cases, funds may be held back to complete agreed repairs or to address pending HOA assessments.
- Payer and timing: Negotiated in the contract and managed by escrow.
West Hollywood specifics to know
HOA and condo realities
Condos are common in West Hollywood. Request the HOA resale packet as soon as you are in escrow. It discloses dues, reserves, rules, insurance requirements, any pending special assessments, and expected move-in procedures. Associations often need 5 to 10 business days to prepare these documents.
City and county transfer taxes
Los Angeles County recording procedures and fees apply, and many cities apply documentary or transfer taxes. West Hollywood has had its own transfer tax framework, which can change over time. Confirm whether any city tax applies and how your contract allocates payment between buyer and seller.
Title insurance customs
In many California markets, sellers customarily pay the owner’s title policy, while buyers pay the lender’s policy when financing. Customs can shift by neighborhood and negotiation. Ask your agent and title officer to confirm how your contract allocates these items.
Property tax prorations and assessments
California property taxes are prorated at closing. Also check for any special assessments, including Mello-Roos or parcel taxes, which add to the annual tax bill. Your title report and tax statements will identify these if applicable.
Estimate your cash to close
Use this quick process to get within range early:
- Ask your lender for a Loan Estimate within three business days of application. This shows loan fees, prepaids, and escrow reserves.
- Request a written estimate from your title and escrow team. It should include escrow fees, title premiums, recording fees, and any known transfer taxes.
- Get the HOA resale packet immediately after opening escrow. Note estoppel charges, transfer or move-in fees, first month’s dues, and any pending assessments.
- Decide if you will pay discount points for a lower rate. Compare the upfront cost to your expected time in the home.
- Confirm how your contract allocates escrow and title fees. Ask about possible seller credits to reduce your cash to close.
- Subtract your earnest money deposit, since it will be credited at closing, and confirm wire timelines for the final balance.
Example scenarios
These illustrative examples use round numbers. Your actual figures will depend on your loan, property, calendar, HOA, and negotiated terms.
Example A: Financed condo at $900,000 (20% down)
- Down payment: $180,000
- Typical financed closing costs at 2% to 4%: about $18,000 to $36,000
- HOA-related items: estoppel/resale packet, first month’s dues, possible move-in fee (budget $200 to $1,500 depending on the association)
- Approximate cash to close: $198,000 to $216,000, minus any earnest money already deposited
Example B: Financed single-family at $2,000,000 (20% down)
- Down payment: $400,000
- Typical financed closing costs at 2% to 4%: about $40,000 to $80,000
- Additional considerations: larger title and escrow premiums, possible city or county transfer taxes based on price
- Approximate cash to close: $440,000 to $480,000, minus any earnest money already deposited
Example C: Cash condo at $900,000
- No lender fees and no lender’s title policy
- Typical cash buyer closing costs about 0.5% to 2%: about $4,500 to $18,000
- Includes escrow, recording, any buyer-paid title charges, HOA fees, and inspections
- Approximate cash to close: purchase price plus closing costs and prorations
Ways to manage closing costs
- Compare lenders: Ask for Loan Estimates from at least two lenders and review origination fees, points, and prepaids side by side.
- Evaluate points vs rate: Price out the breakeven for buying points based on how long you plan to hold the loan.
- Negotiate credits: Request seller credits toward closing costs when the market and property allow. Your contract can also allocate specific fees.
- Right-size inspections: Order the inspections that match the property’s age, systems, and history, and add specialists only when warranted.
- Time your closing: Closing near month end can reduce prepaid interest. Ask your lender how the calendar affects your cash needs.
- Get firm quotes: Ask escrow and title for written estimates early, including any city transfer taxes and exact recording fees.
What to do next
If you are planning a West Hollywood purchase, the next step is to get your numbers dialed in. We can help you secure precise escrow and title estimates, interpret HOA documents, and coordinate clean, on-time funding. For tailored guidance and a calm, private process from search to closing, connect with The Alligood Group.
FAQs
How much should a West Hollywood buyer budget for closing costs?
- If you finance, budget about 2% to 5% of the purchase price; if you pay cash, budget about 0.5% to 2%, then confirm specifics with your lender and escrow team.
Who usually pays for title insurance in California home sales?
- In many markets sellers customarily pay the owner’s policy while buyers pay the lender’s policy, but all title charges and allocations are negotiable in the contract.
Are city or county transfer taxes paid by buyers in West Hollywood?
- Transfer taxes are often paid by sellers in California, but city and county customs vary, and parties can negotiate, so confirm allocations with escrow and your agent.
What HOA-related fees might a West Hollywood condo buyer pay at closing?
- Expect an HOA resale packet or estoppel fee, possible transfer or move-in fees, first month’s dues, and any prorated assessments, with exact amounts set by the association.
When will I see my final closing costs before signing?
- Lenders must provide a Closing Disclosure at least three business days before closing, and escrow will share a final settlement statement with exact line items prior to funding.
