Key Takeaways
- The earnest money deposit is credited toward your down payment on the settlement statement, so you are not paying it twice.
- The New Jersey Department of Banking and Insurance estimates nonrecurring closing costs at about 3 to 4 percent of the sale price. On a $600,000 purchase, that is roughly $18,000 to $24,000, plus prepaids and escrow reserves.
- Cash to close includes at least eight categories beyond the down payment: attorney, inspections, title and survey, lender charges and appraisal, recording, prepaids, escrow reserves and the property tax adjustment.
- On sales above $1 million, the New Jersey Division of Taxation states the seller is statutorily responsible for the graduated percent fee. Older articles still say the buyer pays. A contract can shift it, so your attorney should check that clause.
- Your final wire amount comes from your attorney, lender or title professional. Confirm wiring instructions by phone at a verified number before you send funds.
Why the Down Payment Is Only Part of What You Need
This is the mistake I see most often with buyers in Bergen and Hudson County. They save for the down payment, get preapproved, and then learn two weeks before closing that they need a significant amount more. The down payment is the largest single number, but it is far from the only one.
The New Jersey Department of Banking and Insurance's home-buying guide lists the one-time settlement costs that fall on the buyer: loan application fees, credit reports, appraisal, commitment and lock-in fees, inspections, title insurance and a survey. It also notes that several months of escrow payments are often required. None of that is the down payment. It sits on top of it.
I frame it the same way for every buyer: your cash requirement has two buckets. The first is your down payment, net of the deposit you already made. The second is everything else it takes to reach the closing table. Both have to be funded before you close.
What the down payment depends on
According to the Consumer Financial Protection Bureau, the down payment you need depends on the loan program and the lender, not on any New Jersey or county rule. Conventional, FHA, VA and USDA loans carry different minimums, a conventional loan with less than 20 percent down usually carries mortgage insurance, and some programs allow gifts or grants. For the options in this market, including NJHMFA assistance, see the down payment guide for Bergen and Hudson County.
How the earnest money deposit fits in
The deposit is not an extra cost. The DOBI guide says it is usually applied as part of the down payment. You pay it earlier, typically with the offer and again after attorney review, it is held in escrow under the contract, and it shows up as a credit on your Closing Disclosure. The balance you owe at closing drops by whatever you already deposited.
In practice, you need the cash available early to fund the deposit, but your total requirement does not change because of it.
The Cash Categories Every Buyer Should Plan For
The dollar amount in each category depends on your price, loan program, property type, closing date and what gets negotiated. Your lender's Loan Estimate and your attorney will produce the real figures. Knowing the categories means none of them surprises you.
Attorney fees
In North Jersey, buyers customarily hire their own real estate attorney. Your attorney handles the three-business-day attorney review, negotiates the contract, coordinates title and payoff issues, and works with the lender through settlement. The engagement terms set the fee, separate from any title or lender charge.
Inspections
You pay the inspector directly, usually after your offer is accepted. A general home inspection is standard. Depending on age and construction, you may add radon, termite, oil tank, sewer scope, mold or structural inspections. A 1960s split-level in North Bergen needs a different plan than a newer condo in Edgewater. Budget for what the property needs, not a flat number.
Title search, title insurance and survey
Title work confirms who owns the property and whether liens or judgments are attached. Most lenders require a lender's title policy, and you may also buy an owner's policy for your own protection. Many buyers order a survey to show property lines and anything that crosses them. The cost depends on the price and the insurer.
Lender charges and appraisal
The mortgage carries its own charges: application, credit report, underwriting and the appraisal, which is usually paid early. These appear on the Loan Estimate after you apply and are finalized on the Closing Disclosure.
Prepaids
Prepaids cover a future period: interest from closing to the end of the month, usually the first year of homeowners insurance, and any prepaid taxes. The closing date changes the prepaid interest, which is one reason the final wire amount is not known until close to closing.
Initial escrow reserves
If your lender requires an escrow account for taxes and insurance, you fund an initial deposit at closing. It is a cushion the lender holds so future bills are paid on time, separate from the prepaids above.
Property tax adjustment
New Jersey property taxes are paid quarterly. If the seller has already paid the current quarter past your closing date, you reimburse your share on the settlement statement. It is a fair adjustment, not a fee, but it is real cash at closing and buyers rarely see it coming.
Recording and other closing charges
Recording fees, municipal lien searches and similar items appear on the settlement statement. They are generally modest, but they belong in your plan.
The over-$1 million fee: who pays changed in 2025
The New Jersey Division of Taxation states that the seller is statutorily responsible for both the Realty Transfer Fee and the graduated percent fee on transfers above $1 million. Before July 2025, that over-$1 million fee, often called the mansion tax, was paid by the buyer at a flat 1 percent. The 2025 change moved it to the seller on a graduated scale that starts at 1 percent and rises to 3.5 percent at the top.
Two things matter for you as a buyer. Much of what you will read online, including older state guides, still says the buyer pays, and that is out of date. And the parties can agree otherwise, so in a competitive situation above $1 million a seller may ask the buyer to absorb it. That is a negotiated term, not the law, and your attorney should read that clause during attorney review.
How to Read Your Closing Disclosure
The Closing Disclosure shows your final loan terms, every charge, prepaids, escrow deposits, credits and the exact cash to close. Your lender must provide it at least three business days before your loan closes. Do not skip that review.
Compare it line by line with your Loan Estimate. Confirm your deposit credit, any seller or lender credits, the tax adjustment and the title charges. Raise any difference with your lender, attorney or closing agent before funds are wired.
Paid before closing: earnest money deposit (credited back at closing), home and specialty inspections, appraisal if collected up front.
Due at closing: total down payment, minus deposits already paid, plus attorney fee, title search and insurance and survey, lender charges, recording charges, prepaid interest and insurance (and flood insurance if required), initial escrow reserves, your share of prepaid property taxes, and any condo or HOA capital contribution, minus any seller or lender credits. That equals your final wire.
Your attorney, lender or title professional provides the final wire amount. Confirm the wiring instructions independently. Wire fraud is real, and a call to a verified number before you send funds is worth every second.
Buying a condo, co-op or townhouse adds a layer. Many associations collect a capital contribution or move-in fee at closing under their governing documents, and those documents deserve a review before your contract is final. Condo and co-op financing also differs from single-family underwriting, so ask your lender early to confirm the building's approval status rather than assuming it.
Your number depends on your price, loan program, property type, closing date and contract terms. That is the conversation I have with every buyer before we make an offer, as part of my home purchasing services. For the full sequence from preapproval to closing, see the Bergen County buyer's game plan for 2026, and to run the math on real homes, see what your budget actually buys in Bergen County or search current listings.
The Three Pillars Behind Every Good Decision
Every real estate decision sits where timing, lifestyle, and finances meet. Start with the first and work through all three.
Timing & Strategy
Know whether you are ready to buy now or should build more cash first. Start with the Seven-Question Assessment, seven quick questions and about 90 seconds, at quiz.sellecksellsnj.com.
Lifestyle & Location Fit
Compare towns and property types, since a condo and a single-family home carry very different closing costs. Explore the Northern New Jersey Community Guides at northernnj.sellecksellsnj.com/towns.
Financing & Cash-Flow
Map your full cash to close, not just the down payment, before you make an offer. Go deeper on strategy and the full picture at scott.sellecksellsnj.com.
Frequently Asked Questions
How much money do I need upfront to buy a house in Bergen or Hudson County?
More than the down payment. You also need attorney fees, inspections, title insurance, lender charges, prepaids and initial escrow reserves. New Jersey's consumer guide estimates nonrecurring closing costs at about 3 to 4 percent of the sale price, on top of the down payment. Your Loan Estimate and your attorney will give you the real number.
Does the earnest money deposit count toward my down payment?
Yes. The New Jersey DOBI consumer guide says the deposit is usually applied as part of the down payment. It appears as a credit on your Closing Disclosure and reduces what you owe at closing.
Who pays the attorney and title costs in a New Jersey home purchase?
In Bergen and Hudson County, the buyer and seller each typically hire and pay their own real estate attorney. Title insurance costs depend on whether you buy a lender's policy, an owner's policy or both, and on the price and the insurer.
What are prepaids and escrow reserves?
Prepaids are costs collected at closing for a future period, such as prepaid interest and the first year of homeowners insurance. Escrow reserves are an initial deposit your lender holds to pay future tax and insurance bills. Both depend on your closing date, tax bill and premium.
Can the seller give me a credit toward closing costs?
Yes. Seller credits are negotiable and reduce what you bring to closing. Your lender limits total credits based on the loan program and loan-to-value ratio, so confirm the amount with your lender before it goes into the contract.
When will I know the exact amount to bring to closing?
Your lender must provide a Closing Disclosure at least three business days before your loan closes. The figure can still shift with prepaid interest, escrow calculations, tax adjustments and credits, so review it with your attorney before wiring funds.
Does the buyer pay New Jersey's mansion tax on a home over $1 million?
Not by default anymore. The New Jersey Division of Taxation states the seller is statutorily responsible for the graduated percent fee on transfers above $1 million. The contract can still assign it to the buyer, so have your attorney confirm who pays it during attorney review.
Want to map out your full cash requirement before you start your search? Take the Seven-Question Assessment, or schedule a conversation and we will walk through your numbers.
SRES, e-PRO | Licensed since 1993
NJ Real Estate Broker Sales Associate License #9236275. Keller Williams City Views Realty. Each office is independently owned and operated. Broker compensation in New Jersey is fully negotiable and is not set by law or by any board or association of REALTORS®. This article is general information only and is not legal, tax, or financial advice. Confirm your own costs with your real estate attorney, tax advisor, or lender. Equal Housing Opportunity.
Top 5 Sources
- New Jersey Department of Banking and Insurance, A Guide to Buying a Home (closing costs, deposits). nj.gov/dobi
- New Jersey Division of Taxation, Realty Transfer Fee and Graduated Percent Fee. nj.gov/treasury
- Consumer Financial Protection Bureau, What is a Closing Disclosure? consumerfinance.gov
- Scott Selleck Foundation Document for voice, positioning, and advisory framing.
- Scott Selleck Link Directory for CTA structure, internal linking, and required site references.
