Closing costs are one of the most common sources of confusion for buyers and sellers, especially for those relocating to Santa Fe from other states. While the concept of closing costs exists everywhere, the structure, responsibilities, and typical amounts can vary by market.
Understanding what closing costs include, and who typically pays for what in Santa Fe, helps prevent surprises and supports smoother transactions.
What Are Closing Costs
Closing costs are the fees and expenses required to complete a real estate transaction. They are paid at closing and cover services provided by lenders, title companies, government entities, and other professionals involved in transferring ownership.
Closing costs are separate from the purchase price and are negotiated as part of the contract.
Typical Closing Costs for Buyers in Santa Fe
Buyers generally pay a larger share of closing costs, especially when financing is involved.
Common buyer closing costs include:
Loan Related Costs
- Loan origination or underwriting fees
- Appraisal fee
- Credit report fee
- Lender processing and administrative fees
Title and Escrow Costs
- Lender’s title insurance policy
- Title search and closing services
- Recording fees
Prepaid Items
- Homeowners insurance premium
- Property tax prorations
- Prepaid interest from closing date to first payment
Inspections and Due Diligence
- Home inspection and specialty inspections
- Survey or Improvement Location Report, if required
As a general range, buyer closing costs in Santa Fe often fall between 2 percent and 4 percent of the purchase price, depending on financing, lender choice, and transaction complexity.
Typical Closing Costs for Sellers in Santa Fe
Seller closing costs are usually more predictable.
Common seller closing costs include:
Brokerage Fees
- Real estate commissions, as negotiated in the listing agreement
Title and Transfer Costs
- Owner’s title insurance policy
- Recording fees related to conveyance
Prorations and Fees
- Property tax prorations through the date of closing
- HOA or COA document fees, if applicable
Septic Obligations
- For properties served by septic systems, the seller typically pays for the septic evaluation and any required corrective work, unless negotiated otherwise
Seller closing costs typically range between 6 percent and 8 percent of the purchase price, largely driven by brokerage fees.
Who Pays Title Insurance in Santa Fe
In Santa Fe and much of New Mexico:
- The seller typically pays for the owner’s title insurance policy
- The buyer pays for the lender’s title insurance policy, if financing is used
This allocation is customary but can be negotiated as part of the contract.
Can Closing Costs Be Negotiated
Yes. Closing costs are negotiable.
Examples include:
- Seller contributions toward buyer closing costs
- Credits in lieu of repairs
- Allocation of survey or ILR costs
- Adjustments based on appraisal outcomes
Negotiation depends on market conditions, pricing strategy, and the strength of the offer.
Closing Costs That Surprise Out of State Buyers
Relocation buyers are often surprised by:
- Title insurance being paid by the seller rather than split
- Septic evaluation costs being a seller obligation
- HOA and COA document review fees
- Insurance related costs tied to wildfire zones or roof type
Local guidance makes these items easier to anticipate.
Why Understanding Closing Costs Matters
Closing costs affect:
- Net proceeds for sellers
- Cash required to close for buyers
- Offer strength and competitiveness
- Financing strategy and timelines
Being clear on closing costs early allows buyers to plan accurately and sellers to price and negotiate strategically.
Final Thoughts
Closing costs in Santa Fe follow established local practices, but they are not fixed rules. Understanding what is typical, what is negotiable, and how costs are allocated helps transactions move forward with fewer surprises and less stress.
Whether buying or selling, clarity around closing costs is an essential part of a successful outcome.
✨ About Adrienne DeGuere, Sotheby’s International Realty, Santa Fe
I am a licensed Realtor specializing in Santa Fe’s luxury and relocation markets, with 130 successful transactions and extensive experience guiding buyers and sellers through closing costs, contract terms, and negotiation strategies unique to Northern New Mexico.
If you are preparing to buy or sell and want a clear estimate of what your closing costs may look like, contact me. I am happy to walk through the numbers and help you plan with confidence.
