Closing Fees vs Prepaids
Not all closing costs are fees you lose. See how much is actual transaction cost versus money deposited into escrow for your benefit.
Try It: How Closing Date Affects Prepaids
Move the closing date later in the month to reduce prepaid interest. Change the rate to see the daily cost shift.
Closing Fees (Fixed)
Prepaids (Dynamic)
Closing on the 28th saves $690 vs closing on the 1st in prepaid interest alone.
What Are Prepaids and Why They Matter
Prepaids are not fees -- they are advance payments for property taxes, homeowners insurance, and mortgage interest that get deposited into escrow. Unlike lender fees or title charges, prepaid money is still yours: it pays future bills you would owe anyway. Separating prepaids from true fees shows you the real cost of the transaction versus money that is simply being moved from your bank account to an escrow account.
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Prepaid interest: daily interest from closing date to end of month (15 days = $863)
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Prepaid property tax: typically 3 months of tax reserves ($1,252)
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Prepaid insurance: 14 months of homeowner insurance ($1,775)
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Total prepaids ($3,890) is money in escrow -- not a fee you lose
How Closing Date Affects Prepaid Interest
Prepaid interest is calculated from your closing date through the end of that month. Closing on the 1st means 30 days of prepaid interest; closing on the 28th means just 3 days. This is one of the few closing costs you can directly control by choosing your closing date strategically.
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Close on the 28th: 3 days of prepaid interest ($173) instead of 15 days ($863)
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Closing later in the month reduces cash needed at closing by hundreds
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Your first mortgage payment is delayed by one month regardless of closing date
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The rate sensitivity table shows how interest rate changes affect this calculation
Explore More Features
See everything Closing Cost Estimator has to offer.
Cost Breakdown
See 25+ line items organized by category for both buyers and sellers.
Learn more →State-Specific Estimates
Auto-apply transfer tax rates for all 50 states plus DC with full override support.
Learn more →Net Proceeds Calculator
See exactly what the seller walks away with after commissions, costs, and mortgage payoff.
Learn more →Cash to Close Calculator
See the total cash needed at closing: down payment + buyer costs - earnest money.
Learn more →What-If Scenario Comparison
Compare saved estimates against what-if scenarios to see how changes affect costs.
Learn more →Buyer & Seller Summary
See both sides of the transaction on one screen with every line item, category totals, and a combined grand total.
Learn more →AI-Powered Prompts
Four ready-to-use prompts pre-filled with your closing cost data for AI-powered analysis.
Learn more →Email Templates
Three pre-written emails for your agent, lender, and title company -- pre-filled with your numbers.
Learn more →AI Contract Review Pipeline
Analyze closing disclosures, loan estimates, and settlement statements with a 5-step AI pipeline: plain English, risks, obligations, negotiation playbook, and executive brief.
Learn more →See Where Your Closing Cash Actually Goes
Separate real fees from escrow deposits. Know the true cost of the transaction versus money that is still yours.
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