Map Reveals States With Highest Mortgage Closing Costs

Americans' interest in refinancing their mortgage payments has risen in the months leading up to the start of the Iran war, fueled by a steady decline in rates that was only reversed after the U.S. and Israel launched joint strikes on the Middle Eastern country, leading them to jump back above the 6 percent mark.

Application for loan refinancing actually declined 4.4 percent in the week ending May 8 when compared to the previous week, according to the latest data by Haver Analytics, but were up a whopping 14.9 percent year-over-year.

That is probably because mortgage rates, while once again rising, are much lower than they were this time of the year in 2025. As of May 14, the 30-year fixed-rate mortgage was 6.36 percent, down from 6.81 percent a year earlier.

For many Americans, refinancing their mortgage can be a significant improvement in affordability. The average refinance loan amount in the U.S. is now $330,622, according to a new study by LodeStar Software Solutions, a provider of mortgage closing cost data.

The average total closing costs with recording and taxes are $2,207, or 0.67 percent of the refinance loan amount.

But in some states, closing costs can be much higher-making it significantly less convenient for homeowners.

States Where Closing Costs to Refinance Are the Highest

Closing costs tend to be higher in states where the transfer taxes make up a big bulk of the overhead. New York has the highest closing costs as a percentage of sale price in the nation, at 2.06 percent of the refinance loan amount.

It is followed by Florida (1.36 percent), Oklahoma (1.13 percent), Pennsylvania (1.01 percent) and Texas (0.96 percent).

"The state-by-state ranking largely aligns with what industry participants would expect," Ron Carvalho, LodeStar's Director of Data, said in a statement.

"New York, Florida, and Maryland appearing at the top is not surprising, as refinance closing costs are heavily influenced by each state's mortgage taxes, recording, and related fee structure," he added.

"New York stands out in particular, with average total refinance closing costs of $10,553, representing 2.06 percent of the average refinance loan amount. That percentage is more than double most other states in the report, with only a couple exceptions, including Florida at 1.36 percent."

States Where Closing Costs to Refinance Are the Lowest

On the opposite end, closing costs tend to be lower in states without transfer taxes or with minimal ones. California leads the pack with closing costs representing 0.32 percent of the refinance loan amount, followed by South Dakota (0.35 percent), and Arizona (0.37 percent).

To come up with this data, LodeStar defined average closing costs as the average fees, recordation charges, and transfer taxes required to close a typical refinance transaction in a geographical area, in addition to the following service types: settlement/closing/escrow fees, and lender's title policies.

The company calculated the percentage of the loan amount as the average total closing costs with recording fees & taxes included divided by the average loan amount in a given geographical area.

Should You Refinance Your Home?

Refinancing your home can be a great way to save some money on your mortgages-but homeowners should be wary of climbing mortgage rates.

"For many homeowners who locked in low first-mortgage rates during the pandemic era, a higher-rate cash-out refinance may make sense for a specific segment of borrowers, particularly those looking to consolidate debt or simplify their finances into a single loan," Kyle Bass, Production Business Manager at Refi.com, a mortgage refinancing platform, said in a statement shared with Newsweek.

"For others, we're seeing more homeowners explore HELOCs [Home Equity Line of Credit] and home equity loans to access equity while preserving their existing mortgage rate."

A HELOC is a revolving line of credit secured by an individual's home. It allows homeowners to borrow against the equity they have built up, using their property as collateral.

Refi.com's recent home equity analysis found that HELOC originations increased to more than 504,000 in 2025 from roughly 456,000 in 2024, while the average approved HELOC credit limit climbed to approximately $135,000 as homeowners become increasingly strategic about using their equity while preserving favorable first-mortgage financing.

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This story was originally published May 16, 2026 at 7:23 AM.