Key Takeaways
-
The 2% to 4% Rule: Buyers in Charleston should expect to pay between 2% and 4% of the total loan amount in closing costs.
-
The Attorney State: South Carolina requires a licensed real estate attorney to conduct the closing (you cannot just use a title company).
-
Prepaid Expenses: Your biggest closing cost chunk is often "prepaids"—setting up your escrow account with a year of homeowner's and flood insurance.
- Negotiation is Back: Unlike in 2022, buyers in 2026 have the leverage to ask sellers to contribute to these closing costs.
One of the worst feelings in real estate is getting to the finish line, looking at your final settlement statement, and realizing you owe $8,000 more than you thought.
When buyers calculate their moving budget, they almost always focus on the down payment. But in South Carolina, the down payment is only part of the cash you need to bring to the closing table. You also have to pay closing costs.
So, what exactly are you paying for, and how much is it going to cost you in 2026? Let's break down the math.
The Standard Closing Costs in SC In the Charleston market, buyer closing costs typically range between 2% and 4% of your loan amount (not purchase price). If you are buying a $500,000 home, you should budget roughly $10,000 to $20,000 for these fees. Here is where that money goes:
1. Loan Origination & Lender Fees Your lender will charge a fee for processing and underwriting your mortgage. This is usually around 0.5% to 1% of the loan amount.
2. The South Carolina Attorney Fee South Carolina is an "Attorney State." You must hire a real estate lawyer to perform the title search and facilitate the closing. This generally costs between $600 and $1,200.
3. Title Insurance Lender's title insurance is mandatory; Owner's title insurance is optional but highly recommended. This protects you if someone later claims they have a legal right to your property.
4. Appraisals and Inspections While you usually pay for the home inspection ($400-$600) out of pocket at the time of service, the bank's appraisal fee ($500-$700) is often rolled into your final closing costs.
The "Prepaids" (The Hidden Chunk) This is what catches buyers off guard. Your lender will require you to pre-fund your escrow account. You will likely need to pay for a full year of Homeowner's Insurance upfront, plus several months of property taxes. If you are buying a home in a flood zone (AE or VE), you will also be paying for a year of flood insurance upfront.
Neighborhood Watch: The Insurance Impact
-
Downtown Charleston & Folly Beach: Closing costs can feel higher here simply because flood insurance and wind/hail premiums are much more expensive to prepay.
-
Summerville / North Charleston: Homes further inland (X Flood Zone) require significantly less upfront cash for insurance prepaids.
-
Mount Pleasant: If you are buying in an HOA community (like Park West), expect to pay an "HOA Capital Contribution" fee at closing, which can be anywhere from .05% to 1.5% of the purchase price.
Frequently Asked Questions:
Q: Can I roll my closing costs into my loan? A: Usually, no. However, we can negotiate with the seller to pay a portion of your closing costs (called "Seller Concessions"), which effectively does the same thing.
Q: Who pays the real estate agent commission? A: Traditionally, agent commissions are paid by the seller out of the proceeds of the sale, not by the buyer. However this is all negotiable and clearly stated in your agency representation agreement.
By: Dustin Guthrie, Realtor
📞 Call/Text (843) 697-7757
📧 [email protected]
📸 Instagram @dustin_guthrie_realtor
