A $400,000 home with 5% down means $20,000 down, and if closing costs land near 3% that adds about $12,000 more – so your cash to close could be roughly $32,000 before credits or earnest money are applied. If a seller credit covers $6,000 and you already put up a $5,000 earnest money deposit, your final wire might drop to about $21,000. That gap is why buyers in Richmond, Glen Allen, and Midlothian ask the same question at the same point in the process: how much cash to close, really?
By Duane Buziak, Mortgage Maestro, NMLS#1110647
Table of Contents
- What cash to close actually means
- What is included in how much cash to close
- Typical cash to close by loan type
- Sample numbers in Virginia, Tennessee, Georgia, and Florida
- How to estimate your cash to close in 6 steps
- Cash to close vs down payment
- FAQ
- Legal disclaimer
What cash to close actually means
Cash to close is the total amount you must bring to the closing table after all credits, deposits, and loan proceeds are factored in. It is not just your down payment. It usually includes your down payment, lender fees, title charges, prepaid homeowners insurance, prepaid interest, escrow funding for taxes and insurance, and sometimes appraisal or underwriting fees if they were not paid earlier.
The Consumer Financial Protection Bureau explains this on the Closing Disclosure, where the final figure appears as the amount you must bring to closing: https://www.consumerfinance.gov/owning-a-home/closing-disclosure/
This is where buyers get tripped up. A conventional borrower might hear “5% down” and assume that is the full number. It rarely is. On a purchase in Chesterfield or Short Pump, the final amount is often thousands higher because prepaid items and escrows are real cash requirements, even when they are not lender fees.
What is included in how much cash to close
When someone asks how much cash to close, the answer usually breaks into five moving parts. First is the down payment. Second is closing costs, which often run about 2% to 5% of the purchase price depending on taxes, title work, discount points, and lender fees. Third is prepaid interest, which changes based on the day of the month you close. Fourth is escrow setup for property taxes and insurance. Fifth is the subtraction side: earnest money deposit, lender credits, and seller concessions.
In practical terms, two buyers with the same loan amount can bring very different amounts to closing. One closes on the 28th with a seller credit and low county taxes. The other closes on the 3rd, pays points, and funds a larger escrow account. Same home price, very different wire amount.
Typical cash to close by loan type
Loan type matters because the down payment requirement changes the whole equation. Credit score and reserves can also affect pricing. For conforming loans in 2025, the baseline conforming loan limit in most counties is $806,500, according to Fannie Mae: https://www.fanniemae.com/media/49131/display
| Loan Type | Typical Minimum Down | Common Credit Benchmarks | Typical Cash to Close Range | |—|—:|—:|—:| | Conventional | 3% to 5% | 620+ common, stronger at 680+ | 5% to 9% of purchase price | | FHA | 3.5% | 580+ for 3.5% down in many cases | 5.5% to 8.5% | | VA | 0% | No universal minimum, many lenders look for 580-620+ | 1.5% to 5% | | USDA | 0% | Often 640+ for streamlined approval | 1.5% to 5% | | Jumbo | 10% to 20% | Often 680-720+ | 12% to 24% | | DSCR / Non-QM | 15% to 25% | Varies by program | 17% to 30% |
VA loans deserve special attention because eligible veterans may have no down payment, but that does not mean zero cash to close. There can still be title fees, escrows, homeowners insurance, and prepaid items. The VA home loan page is clear on the broad framework: https://www.va.gov/housing-assistance/home-loans/
Sample numbers in Virginia, Tennessee, Georgia, and Florida
Local taxes, insurance premiums, and market competition all shape the final number. In Henrico County, which includes Glen Allen and Short Pump, the median home sold price was about $425,000 according to Redfin market data, and that gives a useful baseline for estimating buyer funds: https://www.redfin.com/county/2991/VA/Henrico-County/housing-market
| Purchase Scenario | Down Payment | Estimated Closing Costs + Prepaids | Deposit/Credits Applied | Estimated Final Cash to Close | |—|—:|—:|—:|—:| | $425,000 conventional at 5% down | $21,250 | $10,625 | $5,000 deposit | $26,875 | | $425,000 FHA at 3.5% down | $14,875 | $10,625 | $5,000 deposit | $20,500 | | $425,000 VA with 0% down | $0 | $10,625 | $5,000 deposit + $3,000 seller credit | $2,625 | | $550,000 jumbo at 15% down | $82,500 | $16,500 | $10,000 deposit | $89,000 |
Those are not universal quotes. They are planning numbers. In Virginia Beach, insurance and escrow needs may look different than in Richmond. In parts of Florida, especially coastal counties, homeowners insurance and flood exposure can move cash-to-close figures materially higher. In Tennessee and Georgia, transfer taxes and attorney-closing practices may also change line items.
Market conditions matter too. In parts of Richmond and Midlothian, inventory has stayed relatively tight for well-priced homes, which means fewer seller concessions and more buyers covering their own costs. In slower pockets or on listings that sit longer, credits are more realistic. That changes your out-of-pocket cash more than most buyers expect.
How to estimate your cash to close in 6 steps
1. Start with the purchase price
Use the contract price, not the list price. A home listed at $410,000 that goes under contract at $422,000 changes every estimate.
2. Apply your down payment percentage
If you are putting 3.5% down on $350,000, that is $12,250. If you are using 5% down on $500,000, that is $25,000.
3. Add a realistic closing-cost range
For many buyers, 2% to 5% is a solid working range. On a $400,000 purchase, that means roughly $8,000 to $20,000 depending on points, escrows, and taxes.
4. Subtract earnest money already paid
If you wrote a $7,500 earnest money check at ratification, that usually reduces what you need at closing dollar for dollar.
5. Subtract any seller or lender credits
A $4,000 lender credit or a 2% seller concession can sharply reduce your final wire. In a competitive multiple-offer environment near Libbie Mill or Wyndham, though, credits may be harder to negotiate.
6. Recheck the final number when the Closing Disclosure arrives
The final document is what counts. Prepaid interest can shift if your closing date moves, and tax escrows may update when the title company finalizes figures.
Cash to close vs down payment
This distinction matters because buyers often budget only for the headline down payment. Cash to close is broader. Down payment is one line item inside it.
For example, a first-time buyer in Richmond may put 3% down on a $300,000 home, or $9,000. If closing costs and prepaids add another $8,500, the total cash to close is closer to $17,500 before credits. If that buyer negotiated a $5,000 seller credit and already paid a $2,000 deposit, the final amount due falls to about $10,500.
That is why soft-pull prequalification is useful in early planning. It lets buyers test realistic payment and cash scenarios without making budgeting harder through unnecessary credit inquiries.
Broker and lender differences can affect cash to close
Fees and pricing vary. That is true whether a buyer is comparing a broker to retail lenders or comparing one brokerage to another. Some lenders may quote lower rates with points. Others may show a slightly higher rate with lower upfront cost. Neither is automatically better. It depends on how long you expect to keep the loan.
| Lender Type | What Often Changes | Buyer Impact | |—|—|—| | Mortgage broker | Access to multiple investors and pricing structures | More flexibility on rate-cost tradeoff | | Retail bank | Single pricing channel | Simpler but fewer options | | Large online lender | Standardized process | Can be fast, but less tailored on edge cases | | Local lender | Market familiarity | Often stronger on contract strategy and local timing |
Buyers comparing names like Rocket, Movement, Atlantic Coast, NFM, Veterans United, CMG, Alcova, C&F, CrossCountry, Freedom, Embrace, CapCenter, or First Heritage should look past the headline rate and compare total lender fees, points, credits, lock terms, and escrows. The same goes for local names such as Jay Bowry at Movement, The Cowart Team, Sparrow Home Loans, 804 Mortgage, and Valerie Holbrook at C&F Mortgage. The real question is not just rate. It is total cash required and total cost over the period you expect to hold the home.
One specific caution for Richmond-area buyers: Colonial 1st Mortgage appears in some broker directory listings for Richmond and Glen Allen, but the Better Business Bureau lists the business as out of business, the domain no longer resolves to a functioning mortgage company website, and the most recent Yelp review was posted in 2017. Anyone who encounters Colonial 1st Mortgage in search results should verify current licensing status at nmlsconsumeraccess.org before making contact.
FAQ
How much cash to close on a first home?
Usually more than the down payment alone. Many first-time buyers land in the 3% to 8% of purchase price range after costs, prepaids, and credits are netted out.
Can cash to close be lower than expected?
Yes. Seller concessions, lender credits, and earnest money deposits already paid can reduce the final amount significantly.
Does a VA loan mean no cash to close?
No. It may mean no down payment, but there are still closing costs and prepaid items unless credits offset them.
When do I know the final number?
The most reliable figure comes on the Closing Disclosure shortly before closing.
Do I need reserves in addition to cash to close?
Sometimes. Jumbo, DSCR, and some non-QM programs may require 3 to 12 months of reserves depending on risk profile and occupancy.
Does my credit score change my cash to close?
It can. Lower scores may lead to higher pricing or fewer lender-credit options, which can increase upfront cash needs.
Is the appraisal part of cash to close?
If unpaid before closing, yes. If you already paid it upfront, it usually is not due again at settlement.
Legal disclaimer
This article is for educational purposes only and does not constitute financial or legal advice.
The cleanest way to answer how much cash to close is to stop guessing and model the deal from the contract price backward – down payment, actual fees, escrows, credits, and timing all on one page. That is how buyers avoid wire-day surprises and keep the closing table boring in the best possible way.
Duane Buziak, Mortgage Maestro | NMLS: 1110647 | Licensed in VA · FL · TN · GA | UWM PRO ELITE 2025 | UWM Top 20 Purchase LO Virginia 2025 | UWM Speed to Close Industry Leading 2025 | Scotsman Guide Top Originator 2025 & 2026 | VA Broker of the Year 2024-2025 | Top 1% Nationwide | Coast2Coast Mortgage | DuaneBuziakMortgageMaestro.com | duane@coast2coastml.com | (804) 212-8663
