Closing Costs · Nationwide · Updated October 2026
Lender points, third-party reports, two sets of lawyers, title insurance and a state tax that can be zero or six figures. Here is every line on a $5,000,000 example loan, what each one costs, and which ones you can actually move.
By Michael McGovern, Founder | 25+ Years in Commercial LendingCommercial Mortgage Connection · Yonkers, NY The short answer
Commercial mortgage closing costs on a $5,000,000 example loan run from about $77,000 to about $151,000, or 1.5% to 3.0% of the loan, before any state mortgage tax, and in New York City the tax alone adds $140,000. The honest part first: nobody can give you your final number before a signed term sheet and a title quote, not a lender, not a broker, and not this page. Every range below is an example to plan with, not a quote.
- The biggest lender line: origination points, commonly 0.50 to 1.00 point on bank and agency debt in this example, are $25,000 to $50,000 on $5,000,000.
- The biggest swing: the state. Texas charges no mortgage recording tax, Florida charges 0.55% in two taxes ($27,500 here), and New York City charges 2.8% on commercial mortgages of $500,000 or more ($140,000 here).
- The real price: $151,466 of costs on a 5-year hold adds about 0.74 percentage points to a 6.50% example rate. Costs and rate have to be compared together.
- Related read: how the rate side of a quote is built is covered in our guide to commercial mortgage rates.
Tax rates and premiums checked 2 October 2026 against the Florida Department of Revenue, Florida Statutes, the New York City Department of Finance, the Texas Department of Insurance, HUD, the Federal Register and the OCC. Fee ranges are labeled examples.
What this page covers
- The anatomy of commercial mortgage closing costs: 4 buckets
- Every fee on a $5,000,000 example loan, in dollars
- The state line: from $0 to $140,000 in mortgage tax
- HUD 223(f), agency and bridge: 3 different fee schedules
- What closing costs do to your rate: 23 to 115 basis points
- What borrowers can actually control: 4 levers
- What this page will not tell you: three honest limits
- Does this apply in your state?
- Commercial mortgage closing costs: FAQ
The anatomy of commercial mortgage closing costs: 4 buckets
Every commercial closing statement, however long, sorts into four buckets. Lender charges are origination points, a processing or underwriting fee, and the lender's own legal bill, which the borrower pays. Third-party reports are the appraisal, environmental site assessment, property condition report, survey and zoning report the lender orders to underwrite the asset. Title and government charges are the title search and lender's title policy, recording fees, and in some states a mortgage tax that can be the largest single line on the page. Prepaids and reserves are interest from closing to the first payment, and tax, insurance and replacement reserve deposits.
The last bucket is cash at closing but not a cost: reserves stay your money, held by the lender, and prepaid interest is interest you would owe anyway. On a $5,000,000 example loan at 6.50%, interest runs about $890 a day, so closing 15 days before the first interest period adds about $13,356 to the cash you bring without adding a dollar to the cost of the loan. The other three buckets are real costs, and they behave differently: points scale with the loan, reports scale with the property, and the state tax scales with the loan in some places and does not exist in others.
One more line belongs on every list: the broker. Commercial broker compensation is negotiated per deal, commonly as a percentage of the loan paid at closing, and Commercial Mortgage Connection discloses its fee structure in writing before engagement. Compare it against the terms you would have accepted from the one lender you already knew, not against zero.
Points scale with the loan, reports scale with the property, and the state tax scales with the address. Each bucket needs its own question on the term sheet.
Every fee on a $5,000,000 example loan, in dollars
Here is a full set of commercial mortgage closing costs for an example $5,000,000 permanent loan on a stabilized property, shown as a lean file and a heavy file. The ranges are planning examples drawn from common market practice, not quotes; the one state-set figure is the Texas lender's title premium, which is promulgated by the Texas Department of Insurance and identical at every title company in the state.
| Line item | Paid to | Lean file | Heavy file |
|---|---|---|---|
| Origination, 0.50 to 1.00 point | Lender | $25,000 | $50,000 |
| Processing and underwriting fee | Lender | $2,500 | $7,500 |
| Lender's legal counsel | Lender's attorney | $7,500 | $20,000 |
| Borrower's legal counsel | Your attorney | $7,500 | $20,000 |
| Appraisal | Appraiser | $3,500 | $7,500 |
| Phase I environmental site assessment | Environmental consultant | $2,000 | $4,000 |
| Property condition report | Engineer | $2,000 | $5,000 |
| Survey | Surveyor | $2,500 | $6,000 |
| Zoning report | Zoning consultant | $1,000 | $2,500 |
| Title search, closing fee and endorsements | Title company | $1,500 | $5,000 |
| Credit, background, flood and UCC searches | Vendors | $500 | $1,500 |
| Recording fees | County | $250 | $1,000 |
| Lender's title policy, Texas basic premium | Title insurer | $21,466 | $21,466 |
| Total | $77,216 (1.54%) | $151,466 (3.03%) |
Three things stand out. Points are the single largest controllable line, so a half point is worth $25,000 here, more than every third-party report combined on the lean file. Legal fees come in pairs, because the borrower pays for the lender's counsel as well as its own. And the title premium is not a lean-or-heavy number in Texas at all: the state sets it, which is why the cost difference between two Texas title companies is in the endorsements and closing fee, not the policy. Plug your own loan amount into the free loan calculator with the closing costs added to your cash need, not left out of it.
Two questions
What kind of loan are you closing?
Where is the property?
The state line: from $0 to $140,000 in mortgage tax
The same $5,000,000 loan can carry no mortgage tax at all or a six-figure one, depending only on the address. In Florida, two taxes apply when a mortgage is recorded: documentary stamp tax of 35 cents per $100 on the full amount secured, and the Florida Department of Revenue's own rule says the $2,450 cap that applies to unsecured notes does not apply to a recorded mortgage; plus a one-time nonrecurring intangible tax of 2 mills per dollar under Section 199.133 of the Florida Statutes. Florida law makes the lender the taxpayer for the intangible tax but lets the lender pass it to the borrower, and it usually does.
New York is the outlier. Per the New York City Department of Finance, commercial mortgages of $500,000 or more in the city, which includes apartment buildings, are taxed at 2.8%: 1.05% of state taxes plus a 1.75% city tax. Outside the city but inside the MTA district, the state portion of 1.05% still applies, before any local tax where one is in effect. The rest of the New York picture, including how lenders size loans in the five boroughs, is covered in our NYC commercial mortgage guide.
| Location | What is charged | Rate | On $5,000,000 |
|---|---|---|---|
| Texas | No mortgage recording tax; state-promulgated title premium | Set by TDI rate table | $21,466 title premium |
| Florida | Documentary stamp tax plus nonrecurring intangible tax | 0.35% plus 0.20% | $17,500 plus $10,000 = $27,500 |
| New York State, MTA district outside NYC | State basic, additional and special additional taxes | 1.05%, plus local tax where in effect | $52,500 or more |
| New York City | State taxes plus city tax, commercial, $500,000 or more | 2.80% | $140,000 |
For a New York borrower, that tax is often larger than every other closing cost combined, which is why refinances there are routinely structured to avoid re-taxing the existing balance; that structure is a question for New York real estate counsel before you sign a term sheet, not after.
HUD 223(f), agency and bridge: 3 different fee schedules
HUD 223(f) has federal fees on top of the usual list, but two of them were cut sharply. HUD's regulation sets the application fee for a 223(f) mortgage at $3 per $1,000 of the requested amount, or $15,000 on $5,000,000, and the inspection fee at 1% of the cost of any required repairs, with a HUD-set minimum.
The mortgage insurance premium changed in HUD's notice published 23 September 2025: for applications submitted or amended on or after 1 October 2025, the upfront premium on a 223(f) loan fell from 100 basis points to 25, from $50,000 to $12,500 on this example, and the annual premium fell from 60 basis points to 25. HUD's MAP Guide has long capped the lender's financing fee at 3.5% of the mortgage in most transactions, which is a ceiling, not a price. The process is longer and the reports heavier, so HUD trades higher closing friction for the longest fixed term and highest leverage in multifamily, as the program table on our apartment building loans page shows.
Agency and bank loans follow the table above most closely. The appraisal rule is worth knowing on smaller deals: under the OCC's appraisal rule, a commercial real estate transaction of $500,000 or less at a national bank can be underwritten on an evaluation instead of a full appraisal, while a federally related commercial transaction above $500,000 requires a state certified appraiser.
Bridge and private loans move the cost to points and the exit. Our Dallas bridge examples use 2 points at closing and a 1% exit fee, which on $5,000,000 is $100,000 in and $50,000 out, and the premium for speed is laid out in our guide to a three-week bridge close. The exit side of a permanent loan, yield maintenance, defeasance and step-down, is a different bill, priced in our prepayment penalty guide.
Read the closing statement against the term sheet line by line; most surprises at the table were on the page weeks earlier.
What closing costs do to your rate: 23 to 115 basis points
Closing costs are paid once, but they act like extra interest, and how much depends on how long you keep the loan. Take the $5,000,000 example at 6.50% on a 30-year amortization, a payment of $31,603 a month, with closing costs paid from your own cash and the loan paid off at the end of the hold. The lean $77,216 file raises the true cost of the loan to about 7.08% over a 3-year hold, 6.88% over 5 years and 6.73% over 10 years. The heavy $151,466 file raises it to about 7.65%, 7.24% and 6.95%. Add New York City's $140,000 tax to the heavy file and the 5-year figure reaches about 7.85%, before the New York title premium.
That is the whole case for comparing quotes on total cost, not rate. Over a 5-year hold, the gap between the lean and heavy files, about 36 basis points, is larger than the rate difference between most competing term sheets. A lender that quotes a quarter point lower and charges a point more in fees is the more expensive loan for any owner likely to sell or refinance within about five years; at these example terms the two quotes break even just under the five-year mark.
What borrowers can actually control: 4 levers
1. Points against rate. Ask every lender for the same loan at two fee levels. The trade between a point paid now and a lower rate later has a break-even year, and your hold period decides which side of it you are on.
2. Report reuse and scope. A recent Phase I, survey or property condition report can sometimes be updated rather than redone, if the new lender accepts the original firm and a reliance letter. Ask before the lender orders new reports, not after.
3. Legal fee caps. Lender counsel is billed to you. Ask for a capped or estimated lender legal fee in the term sheet, and keep your own counsel's scope tight on a standard form loan.
4. Matching. Fee schedules are lender policy, so the same file draws different cost stacks from different desks. Commercial Mortgage Connection works a 750+ lender network with 500K+ programs across all 50 states, with $1B+ originated, every engagement led personally by founder Michael McGovern, and a loan review response within 4 hours. The comparison we put in front of a borrower lines up rate, points, legal caps, reports and the state line in one place, using the same method laid out in our commercial real estate financing process guide.
What this page will not tell you: three honest limits
It will not give you your final number. Third-party report pricing varies by market, property size and turnaround, and legal bills vary by complexity. The ranges here are planning examples. Your signed term sheet and the title company's quote are the only numbers that close.
It will not replace tax or legal counsel. Mortgage taxes have exemptions, credits and structures that depend on the transaction, and recording tax rules differ by county. CMC gives no tax or legal advice; confirm every tax line with the closing attorney or title company.
It is written by a brokerage. Commercial Mortgage Connection is paid when loans close, which is exactly why this page tells you to compare quotes on total cost, to count the broker fee in that comparison, and that if your own bank's term sheet already carries low points and capped legal fees, that quote deserves to win.
Does this apply in your state?
Commercial Mortgage Connection is headquartered in Yonkers, NY and places loans through its 750+ lender network in all 50 states. The four buckets, the lender and report fees and the cost-to-rate math on this page apply anywhere; the tax and title figures are specific to Texas, Florida and New York as cited.
Mortgage recording taxes, transfer taxes, title insurance pricing and recording fees vary sharply by state and often by county. Some states promulgate title rates, others let insurers file their own, and several charge no mortgage tax at all. Confirm the rules for the county your property sits in before you sign a term sheet, and treat every tax figure on this page as specific to the jurisdiction named.
Commercial mortgage closing costs: FAQ
How much are closing costs on a commercial mortgage?
On a $5,000,000 example permanent loan, commercial mortgage closing costs run from about $77,000 to about $151,000, or 1.5% to 3.0% of the loan, in a state with no mortgage tax. Origination points are the largest line, commonly 0.50 to 1.00 point on bank and agency debt in this example, followed by legal fees, third-party reports and title. A state mortgage tax is added on top where one applies.
What is the mortgage recording tax on a commercial loan in New York City?
Per the New York City Department of Finance, commercial mortgages of $500,000 or more in New York City, including mortgages on apartment buildings, are taxed at a combined 2.8%: 1.05% of state taxes and a 1.75% city tax. On a $5,000,000 loan that is $140,000. The title company or closing attorney confirms the exact figure for a specific mortgage.
Can closing costs be rolled into a commercial loan?
Sometimes, but only within the leverage and coverage limits. Lenders size the loan off value and debt service coverage, so if the loan is already at its maximum, costs come out of your cash. Even when costs are financed, you pay interest on them for the life of the loan. Points are often netted from proceeds at closing, which reduces the cash you receive rather than the loan amount.
Who pays the lender's legal fees on a commercial loan?
The borrower. In commercial lending, the lender's counsel drafts the loan documents and the borrower pays that bill at closing, in addition to its own attorney. In this page's $5,000,000 example, the two legal lines together run from about $15,000 to about $40,000. Ask for a capped or estimated lender legal fee in the term sheet.
Are HUD 223(f) closing costs higher than a bank loan?
Usually, yes. A HUD 223(f) loan carries an application fee of $3 per $1,000 of the requested mortgage, an inspection fee of 1% of required repairs with a HUD-set minimum, and an upfront mortgage insurance premium, which HUD cut to 0.25% for applications submitted or amended on or after 1 October 2025. In exchange, the program offers a long fixed term and high leverage.
Sources
- Florida Administrative Code Rule 12B-4.051, Documentary Stamp Tax. 35 cents per $100 on recorded mortgages; the $2,450 note cap does not apply to a recorded mortgage. Checked 2 October 2026.
- Florida Statutes, Section 199.133, Levy of nonrecurring tax. One-time tax of 2 mills per dollar on obligations secured by Florida real property. Checked 2 October 2026.
- Florida Department of Revenue, Nonrecurring Intangible Tax. The lender is the taxpayer but may pass the tax to the borrower. Checked 2 October 2026.
- NYC Department of Finance, Statistical Profile of the New York City Mortgage Recording Tax. Commercial mortgages of $500,000 or more: 1.05% state plus 1.75% city, 2.80% total. Checked 2 October 2026.
- Texas Department of Insurance, Title Insurance Basic Premium Rates, effective 1 March 2026. Premium formula for policies of $1,000,001 to $5,000,000. Checked 2 October 2026.
- HUD, Changes in Mortgage Insurance Premiums Applicable to FHA Multifamily Insurance Programs, 90 FR 45789. 223(f) upfront MIP from 100 to 25 basis points, annual from 60 to 25. Checked 2 October 2026.
- 24 CFR 200.40, HUD fees. 223(f) application fee of $3 per $1,000; inspection fee of 1% of repair cost. Checked 2 October 2026.
- 12 CFR 34.43, OCC appraisal requirements. Commercial transactions of $500,000 or less may use an evaluation. Checked 2 October 2026.
Michael McGovernFounder, Commercial Mortgage Connection. Michael wrote this guide drawing on a career that began at Bear Stearns & Co. in 1997, ran through structuring billions of dollars in CMBS and MBS in Bear's F.A.S.T. group and selling mortgage product at Lehman Brothers, and now spans more than $1 billion in originated mortgages.
Stop comparing rates. Compare the whole closing statement.
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Facts on this page were verified against the cited Florida Department of Revenue, Florida Statutes, NYC Department of Finance, Texas Department of Insurance, HUD, Federal Register and OCC sources on 2 October 2026. Tax rates, title premiums, program fees and lending terms change, and every fee range shown above is an example, never a quote or an offer.
Nothing on this page is a loan offer, a rate quote, or personalized financial, tax or legal advice; all financing is subject to lender approval, credit review and property underwriting, and no approval is guaranteed. Terms depend on the asset, the leverage, the sponsor profile and the lender program on the day you apply. Broker licensing and closing rules vary by state. Commercial Mortgage Connection is a commercial mortgage brokerage, is paid when loans close, and sells the service described on this page. Equal Housing Opportunity. Call 888-656-9812 to discuss your scenario.
