Hillsborough Home Closing Costs, Explained

Closing day should not be a guessing game. If you are buying or selling in Hillsborough Township, understanding closing costs early can help you plan your budget, price your home wisely, and negotiate with confidence. You will see which items are standard in New Jersey, what might be negotiable, and how to estimate your cash to close or net proceeds. Let’s dive in.

What closing costs include in Hillsborough

Closing costs are the fees and prepaid items needed to transfer ownership and fund a loan. In New Jersey, buyers typically budget about 2 to 5 percent of the purchase price for closing costs, not counting the down payment. Sellers often plan for roughly 6 to 10 percent when you include real estate commissions, the New Jersey Realty Transfer Fee, attorney fees, and any agreed credits or repairs.

Actual numbers vary. Your final costs depend on price, loan type, local tax prorations, property condition, and which lender, title company, and attorney you choose. For the most accurate estimate in Hillsborough, request written quotes from your lender and a local title company or closing attorney as soon as you go under contract.

Buyer closing costs: what you pay

Typical buyer line items

• Loan origination and lender fees. These may include origination, underwriting, and processing. Some fees are negotiable with lender shopping.
• Appraisal fee. Required by most lenders to confirm the home’s value.
• Credit report and application fees. Usually charged by the lender.
• Mortgage-related third party fees. Items like flood certification and tax service.
• Title search, settlement, and title insurance. You typically pay for the lender’s title policy. An owner’s title policy is optional protection for you and can be paid by either party depending on local custom and negotiation.
• Prepaid and escrow items. Daily mortgage interest from funding to month end, the first year of homeowner’s insurance, and initial deposits into your tax and insurance escrow.
• Property tax proration. You reimburse the seller for taxes from the closing date through the end of the tax period.
• Inspections and reports. Home inspection, radon, termite, septic, well, pool, chimney, or HVAC as needed.
• HOA or condo transfer and processing fees. If applicable, buyers often pay transfer or estoppel fees unless negotiated otherwise.
• Recording fees. Buyer-side recording of the deed and mortgage.

What is negotiable for buyers

• Seller credits toward closing costs. You can request a seller concession. Your loan program may limit the amount, so confirm with your lender.
• Lender fees. Some lenders may reduce or waive certain charges or offer lender credits.
• Title and settlement fees. Depending on local practice, certain charges may be split or shifted by agreement.

Some items are not negotiable, like government recording fees and required third party reports. Appraisals and inspections you order are typically your responsibility.

Hillsborough and Somerset County notes

• Property tax proration. Hillsborough is in Somerset County. Prorations follow the local tax calendar, so confirm current levies and billing timing with the Hillsborough Tax Collector or Somerset County offices.
• Utilities and municipal charges. Outstanding municipal or sewer balances must be cleared at closing if discovered by the title search.
• Well and septic. Parts of Hillsborough use private well and septic. Budget for septic inspections or well testing where applicable.
• Recording process. Verify current recording fees and procedures with the Somerset County Clerk.

Seller closing costs: what you pay

Typical seller line items

• Real estate commissions. Often the largest cost, paid by the seller. The split between listing and buyer brokers is set in your listing agreement.
• New Jersey Realty Transfer Fee. This state fee is commonly paid by the seller and is based on the sale price. Your title company or the NJ Division of Taxation schedule can provide the exact amount for your transaction.
• Mortgage and lien payoffs. Any existing mortgages, home equity lines, or other liens must be paid at closing.
• Title-related items and owner’s title policy. Local custom may assign the owner’s policy to the seller, but this can be negotiated. Confirm what is customary in Somerset County.
• Attorney fees. In New Jersey, many sellers engage an attorney to review documents and manage payoff and closing details.
• Prorations and adjustments. Property taxes, HOA dues, and certain utilities are prorated to the closing date.
• Municipal charges and certificates. Some municipalities require inspections or certificates prior to transfer. Check Hillsborough Township requirements early.
• Seller concessions. Credits to the buyer at closing if negotiated, such as a closing cost credit or a repair allowance.

What is negotiable for sellers

• Commission rate. The rate and structure are set in your listing agreement.
• Concessions and repairs. You can offer a credit or agree to complete repairs after inspection.
• Who pays for the owner’s title policy. Local custom can be changed by agreement between parties.

Items that are typically not negotiable include paying off your loans and any municipal liens, and complying with state-mandated fees like the Realty Transfer Fee.

New Jersey specifics to verify

• The exact Realty Transfer Fee amount. Ask your title company for a calculation based on the contract price or review the NJ Division of Taxation schedule.
• Attorney involvement. While not legally required for every transfer, attorney representation is common in New Jersey and many lenders expect it.
• Hillsborough municipal requirements. Confirm any required local inspections, certificates, or fees prior to listing.

How costs shape offers and net proceeds

Estimating seller net proceeds

A simple way to think about your net is:

Seller net proceeds = Sale price minus (mortgage payoff amounts + real estate commissions + NJ Realty Transfer Fee + seller attorney/title fees + prorated taxes and HOA + any seller concessions + municipal liens or fees + closing adjustments).

To prepare a realistic estimate, gather:

• A payoff statement for each mortgage or line of credit, including per diem interest.
• Current property tax amounts and the proration method.
• The proposed commission rate and any additional marketing costs from your listing agreement.
• A Realty Transfer Fee estimate from your title company.
• Quotes for attorney and settlement fees from local providers.

Calculating buyer cash to close

Buyers can use this general approach:

Cash to close = Down payment + buyer closing costs + prepaid and escrow items minus any seller credits and lender credits.

Your lender’s Closing Disclosure shows the exact figure, usually delivered three business days before settlement.

Negotiation levers you can use

• Seller concessions for buyer costs. A credit at closing can help a buyer with cash needs. Lender rules limit concessions, so buyers should confirm allowable amounts with their loan officer.
• Owner’s title policy. If local custom is flexible, buyers can request the seller to cover the owner’s policy and adjust price or other terms in exchange.
• Repairs versus credits. Credits are often simpler than coordinating contractors before closing. Significant issues may still need repair for loan approval.
• Appraisal gaps. If the appraisal is short, options include a price reduction, buyer cash, or a seller credit within loan limits. Work with your lender and agents to structure the best path.
• Market conditions. In a buyer’s market, sellers may agree to more concessions. In a seller’s market, buyers often shoulder more costs or tighten contingencies.

Loan program limits matter

FHA, VA, USDA, and conventional loans have different rules for seller-paid costs and credits. Ask your lender for a written summary of concession limits tied to your down payment and loan type before you negotiate.

Example: hypothetical net sheet

Below is an illustration for learning purposes only. Replace figures with your actual quotes.

• Sale price: $800,000 (example)
• Mortgage payoff: $450,000 (example)
• Commissions: 6 percent of sale price = $48,000 (example)
• NJ Realty Transfer Fee: use title company estimate based on state schedule (placeholder)
• Seller attorney and settlement fees: obtain quotes (placeholder)
• Prorated taxes and HOA: depends on closing date and billing cycle (placeholder)
• Any agreed seller concessions: for example, a $5,000 buyer credit (placeholder)

Estimated net proceeds formula: $800,000 minus ($450,000 + $48,000 + RTF + fees + prorations + $5,000) = Estimated net.

Run the same calculation with your real numbers for a clear expectation before you accept or counter an offer.

Practical checklists you can use

Buyer checklist

• Ask your lender for a Loan Estimate and an example Closing Disclosure.
• Request a written list of allowable seller concessions for your loan program.
• Get title and settlement quotes from a local title company.
• Budget for inspections, appraisal, and initial escrow deposits.
• If the home has a well or septic, plan for appropriate tests and inspections.
• Verify anticipated property tax proration with your agent and title company.

Seller checklist

• Request a payoff statement for each mortgage or lien.
• Ask your agent for an estimated net sheet, including a Realty Transfer Fee estimate.
• Confirm any required Hillsborough municipal inspections or certificates.
• Obtain quotes for attorney, title, and settlement fees.
• Decide your stance on owner’s title policy and potential buyer credits before negotiations begin.

Timeline and closing logistics

• Typical timeline. Many Hillsborough transactions close in 30 to 60 days, depending on loan type, title work, and any municipal requirements.
• Earnest money. The buyer’s deposit is held in escrow by the listing broker or an attorney and is applied to the buyer’s cash to close at settlement.
• Final figures. The settlement agent prepares the closing statement. Buyers with loans receive a Closing Disclosure at least three business days before closing.

Final thoughts

Understanding how closing costs work in Hillsborough helps you write stronger offers, price with confidence, and avoid last-minute surprises. The best next step is to gather written estimates from your lender, title company, and attorney, then fine-tune your plan with a local advisor who closes deals in this market. If you would like help running your numbers or preparing a strategy for your sale or purchase, connect with Karen for local guidance that puts your goals first.

Ready to talk through your closing costs or get an estimate for your move in Hillsborough? Let’s connect with Karen Boose - Coldwell Banker Realty.

FAQs

Who pays the New Jersey Realty Transfer Fee on Hillsborough home sales?

• In most New Jersey transactions the seller pays the state Realty Transfer Fee, and the exact amount follows a state schedule confirmed by your title company.

How much should Hillsborough buyers budget for closing costs?

• A common planning range is about 2 to 5 percent of the purchase price for buyer closing costs, not including your down payment.

Can I ask the seller to cover some of my closing costs?

• Yes, you can request a seller credit toward your closing costs, but your loan program will limit the maximum amount, so check with your lender first.

Do Hillsborough sellers have to pay buyer closing costs?

• No, seller-paid credits are negotiable; you can offer a credit if it helps the deal, or decline and negotiate on price or repairs instead.

Are septic or well inspections required in Hillsborough?

• Many homes use private well and septic, and buyers often order inspections or tests; requirements depend on the property, loan, and local practice, so confirm with your professionals.

When will I know my exact cash to close as a buyer?

• Your lender must provide the Closing Disclosure with final numbers at least three business days before settlement, which will show your exact cash to close.