Yes, you still pay closing costs when buying a house with cash in Texas, but you skip every lender fee. Your remaining costs are title insurance at the TDI-regulated rate, recording fees, property tax prorations, and contract-assigned items like the survey. Ask the title company for a preliminary settlement statement before closing.
Use the cash-to-close calculator to model your total wire amount before you make an offer.
Title Insurance Is State-Regulated
- Owner’s title policy premium on a $400,000 purchase: $2,262 under the Texas Department of Insurance rate schedule effective March 1, 2026.
- The formula for policies from $100,001 to $1,000,000: Subtract $100,000 from the policy amount, multiply by 0.00494, round the result to the nearest dollar, then add $780. The premium is the same at every title company in Texas.
- Settlement and escrow fees are separate: TDI sets the title insurance premium. TREC contract Paragraph 12A lists the escrow fee separately, with one-half assigned to each party.
What Cash Buyers Skip
- No loan origination or underwriting fee: These charges apply when a lender is involved. With no loan, they do not apply.
- No lender’s title insurance policy: TREC contract Paragraph 12A lists the lender’s title policy as a buyer expense when financing is involved. No lender means no lender’s policy.
- No private mortgage insurance: Conventional borrowers with less than 20% down typically need to pay mortgage insurance to protect the lender. Cash buyers have no lender, so PMI does not apply.
- No lender-required appraisal: A cash buyer may still choose to order an appraisal, but no lender mandates it.
Who Pays What
- Owner’s title policy: The TREC One to Four Family Residential Contract assigns this cost to the buyer or seller by checkbox in Paragraph 6A. The assignment is negotiated, not set by law.
- Survey: Paragraph 6C of the TREC contract gives options: seller provides an existing survey, buyer obtains a new one, or seller obtains a new one.
- Settlement expenses: Paragraph 12A lists specific buyer and seller expenses, including one-half of the escrow fee to each party. The parties may negotiate concessions beyond the enumerated allocation.
No Transfer Tax in Texas
- Constitutional prohibition: Texas Constitution Article VIII, Section 29 prohibits any law imposing a transfer tax on a transaction conveying fee simple title to real property.
- Effective date: The amendment was approved by voters on November 3, 2015, and took effect January 1, 2016.
- What this means at closing: Unlike states that charge a documentary stamp tax or transfer tax, Texas does not add this line item to your settlement statement.
Do cash buyers pay closing costs in Texas?
Yes. A Texas real estate closing involves title work, deed recording, and property tax prorations regardless of how the buyer pays. Cash buyers do not pay loan-related charges such as origination charges, underwriting fees, a loan title policy with lender-required endorsements, lender-required PMI/MIP, and lender-required appraisal or inspection charges. The costs that remain include the title insurance premium at the TDI-regulated rate, recording fees, property tax prorations, the survey if assigned by contract, and any HOA transfer or settlement fees. The total depends on the purchase price, the county, and which costs the contract assigns to the buyer versus the seller.
How much are closing costs for a cash buyer on a $400,000 house?
The exact amount depends on the contract terms and the county. The TDI-regulated owner’s title policy premium on a $400,000 purchase is $2,262. Add recording fees from the county clerk, the title company’s settlement charges, and property tax prorations based on your closing date. If the seller pays the owner’s title policy under the TREC contract, the buyer’s remaining costs are recording, settlement fees, the survey if contract-assigned to the buyer, and prorations. The preliminary settlement statement from the title company is the only reliable estimate for a specific transaction.
Can a cash buyer negotiate which costs the seller pays?
Yes. The TREC One to Four Family Residential Contract allows the parties to negotiate who pays the owner’s title policy, survey, and settlement expenses through checkboxes and written terms. TREC contract Paragraph 12A allows the seller to contribute toward the buyer’s expenses. Each cost assignment is a negotiated contract term.
The Bottom Line Up Front
Cash buyers in Texas pay closing costs, but the total drops because every lender-related fee disappears. The costs that remain are title insurance at the state-regulated TDI premium, deed recording, property tax prorations, and contract-assigned items like the survey, HOA transfer fees, or settlement charges. Who pays each cost is determined by the TREC contract, not by a fixed rule. This guide breaks down each line item, shows the TDI title premium at seven price points, explains how property tax prorations work, and walks through the settlement statement so you know what to expect before you wire.
Costs Cash Buyers Pay and Costs They Skip
The table below separates closing costs into categories for a Texas cash purchase. Some costs are contract-dependent, optional, or applicable only to certain properties such as those in an HOA. In the “Financed buyer pays?” column, some costs are conditional or optional.
| Cost | Cash buyer pays? | Financed buyer pays? | Notes |
|---|---|---|---|
| Owner’s title policy | Contract-dependent | Contract-dependent | Assigned in TREC contract Paragraph 6A |
| Lender’s title policy | No | Yes | Required by the lender per TREC 12A |
| Recording fees | Yes | Yes | TREC 12A buyer expense |
| Property tax proration | Yes, credit or debit | Yes, credit or debit | Depends on closing date and payment status |
| Survey | Contract-dependent | Contract-dependent | TREC contract Paragraph 6C assigns responsibility |
| Loan origination and underwriting | No | Yes | Lender charges for processing the loan |
| PMI | No | Typically, conventional loans with less than 20% down | Lender requirement per TREC 12A |
| Lender-required appraisal | No | Yes | Cash buyer may still choose to order one |
| Home inspection | Optional | Optional | Not a contract-enumerated expense |
| HOA transfer or resale certificate fee | If applicable | If applicable | Applies to properties in an HOA |
| Settlement and escrow fee | Yes | Yes | TREC 12A lists one-half of escrow fee to each party |
A cash buyer skips the loan-related items that do not apply without financing. The remaining costs apply to both cash and financed transactions.
Texas Title Insurance Premiums
Texas title insurance premiums are regulated by the Texas Department of Insurance. The rate schedule effective March 1, 2026 sets the basic premium for every title company in the state. For policies from $100,001 to $1,000,000: subtract $100,000 from the policy amount, multiply the result by 0.00494, round to the nearest dollar, then add $780. The table below shows the owner’s title policy premium at seven purchase prices.
| Purchase price | Owner’s title policy premium | Computation |
|---|---|---|
| $200,000 | $1,274 | $100,000 x 0.00494 + $780 |
| $250,000 | $1,521 | $150,000 x 0.00494 + $780 |
| $300,000 | $1,768 | $200,000 x 0.00494 + $780 |
| $350,000 | $2,015 | $250,000 x 0.00494 + $780 |
| $400,000 | $2,262 | $300,000 x 0.00494 + $780 |
| $500,000 | $2,756 | $400,000 x 0.00494 + $780 |
| $750,000 | $3,991 | $650,000 x 0.00494 + $780 |
These are the basic premiums for the owner’s title policy only. A cash buyer does not pay for a lender’s title policy because there is no lender. Recording fees are listed as a buyer expense in TREC contract Paragraph 12A. Ask the title company for an itemized quote before closing.
Who Pays Closing Costs in a Texas Cash Sale
The TREC One to Four Family Residential Contract determines who pays each cost. The contract uses checkboxes and fill-in blanks for some items and includes enumerated expense allocations in Paragraph 12A. The assignments listed below reflect the TREC form structure, but the contract signed by both parties controls.
- Owner’s title policy: Paragraph 6A of the TREC contract assigns this to the seller or the buyer by checkbox. A cash buyer can offer to pay the owner’s title policy as a concession to the seller, or negotiate for the seller to cover it.
- Survey: Paragraph 6C gives options: the seller provides an existing survey with a T-47 Affidavit or T-47.1 Declaration, the buyer obtains a new survey, or the seller obtains a new survey. If the title company does not accept the existing survey or the affidavit or declaration, the contract checkbox determines who pays for a new one.
- Recording fees: TREC contract Paragraph 12A lists recording fees as a buyer expense. In Bexar County, the filing fee is $25 for the first page and $4 for each additional page, per the Bexar County Clerk’s fee schedule.
- Settlement and escrow fees: Paragraph 12A lists one-half of the escrow fee as a seller expense and one-half as a buyer expense. The parties may negotiate concessions beyond the enumerated allocation.
- Property tax prorations: Paragraph 13 of the TREC contract covers prorations. Taxes are prorated through the closing date based on the current year’s tax bill or an estimate if the bill has not yet been issued.
- HOA and transfer fees: If the property is in an HOA, the TREC Addendum for Property Subject to Mandatory Membership in a Property Owners Association, Form 36-11, addresses transfer fees and the resale certificate. These are separate from HOA dues, which the buyer assumes after closing.
| Cost | Assignment | Contract reference |
|---|---|---|
| Owner’s title policy | Buyer or seller by checkbox | TREC Form 20-19, Paragraph 6A |
| Survey | Varies by negotiation | TREC Form 20-19, Paragraph 6C |
| Recording fees | Buyer | TREC Form 20-19, Paragraph 12A |
| Settlement fee | One-half to each party per 12A | TREC Form 20-19, Paragraph 12A |
| Property tax proration | Prorated through closing date | TREC Form 20-19, Paragraph 13 |
| HOA transfer fees | Varies by contract | TREC Addendum Form 36-11 |
TREC contract Paragraph 12B states that brokerage compensation is not set by law and is fully negotiable, and that each party shall pay their respective brokers pursuant to separate written agreements.
How Property Tax Prorations Work at a Cash Closing
Texas property taxes are billed in arrears. Taxing units mail or deliver property tax bills, and payment is due upon receipt. Taxes become delinquent if not paid by January 31 of the following year. At closing, the title company prorates the current year’s taxes between the buyer and seller based on how many days each party owned the property during the tax year.
- Closing before the tax bill is issued: If you close before the county mails the tax bill, the title company estimates the current year’s taxes using the prior year’s amount. The seller gives the buyer a credit for the seller’s share of taxes from January 1 through the closing date. The buyer later pays the full tax bill when it arrives. Per TREC Paragraph 13, if the actual bill differs from the estimate, the parties adjust the prorations.
- Closing after the tax bill is issued but before payment: If the bill has been issued but not yet paid, the seller credits the buyer for the seller’s ownership period from January 1 through the closing date, and the buyer pays the full bill before the January 31 deadline.
- Closing after the seller already paid the tax bill: If the seller paid the full year’s taxes before closing, the buyer reimburses the seller for the portion covering the buyer’s ownership period from the day after the closing date through December 31.
- Why prorations matter for cash buyers: Tax prorations can move the net amount at closing by thousands of dollars in either direction. The proration credit depends on the closing date relative to January 1. Ask the title company for the estimated proration on your settlement statement so you can factor it into your wire amount.
The TREC contract Paragraph 13 governs prorations. Check your property’s total tax rate at the county appraisal district website before you make an offer. Use the escrow and tax estimator to model different closing dates.
How to Estimate Your Cash Closing Costs
A cash buyer’s closing costs depend on the purchase price, the county, the closing date, and the contract terms. There is no single percentage that fits every transaction. The steps below walk through how to build your estimate line by line.
- Start with the purchase price: The TDI title insurance premium is based on the purchase price. Use the formula or the table in the title insurance section to find the owner’s policy premium.
- Determine who pays the owner’s title policy: Check Paragraph 6A of your contract. If the seller pays, remove the title premium from your estimate. If the buyer pays, include it.
- Add recording fees: TREC contract Paragraph 12A lists recording fees as a buyer expense. In Bexar County, the fee is $25 for the first page and $4 for each additional page per the Bexar County Clerk’s fee schedule.
- Add the settlement and escrow fee: TREC contract Paragraph 12A lists one-half of the escrow fee as a buyer expense. Ask the title company for their fee schedule.
- Add or subtract the property tax proration: Use the prior year’s tax bill to estimate the daily rate. Multiply by the number of days from January 1 through the closing date to estimate the seller’s credit to the buyer.
- Add the survey cost if contract-assigned to the buyer: Check Paragraph 6C. If the buyer is obtaining a new survey, include the surveyor’s fee.
- Add HOA transfer and resale certificate fees if applicable: Check whether the property is in an HOA and what fees apply.
- Request a preliminary settlement statement: After the title company opens the file, ask for a draft settlement statement. This is the closest estimate to your actual wire amount. Review every line item before closing.
TDI Title Premium at Three Price Points
If an owner’s title policy is purchased, the Texas Department of Insurance sets the premium, so the title-insurance rate is the same across Texas title companies. The table below shows the TDI computation at three price points.
| Purchase price | TDI owner’s title premium |
|---|---|
| $300,000 | $1,768 |
| $400,000 | $2,262 |
| $500,000 | $2,756 |
If the seller pays the owner’s title policy, the buyer may still owe county recording fees, title-company settlement charges, the survey if contract-assigned, HOA transfer fees, and the property tax proration. Use the cash-to-close calculator to model your scenario with your specific contract terms.
What Changes When You Buy With Cash
Buying with cash changes the timeline, the required documents, and the costs at closing. It does not change the legal requirements for transferring real property in Texas.
- Closing date: The closing date is a negotiated term in the TREC contract per Paragraph 9A.
- Earnest money and option fee: TREC contract Paragraph 5A requires delivery of the stated earnest money and option fee amounts. If the buyer delivers the option fee, Paragraph 5B grants the buyer the unrestricted right to terminate during the option period. Per Paragraph 5D, if no dollar amount is stated as the option fee or the buyer does not deliver it, the buyer does not have the unrestricted termination right.
- Title work still happens: The title company handles the title search and issues a title commitment per TREC contract Paragraph 6B. Review the commitment before closing.
- Inspection is still your decision: No lender requires it, but the inspection is how you discover structural, mechanical, and safety issues before the option period expires. Skipping it removes your primary opportunity to identify problems.
- Appraisal is optional: Without a lender, no one requires an appraisal. A cash buyer can still order one to confirm the property’s value before closing.
- Wire fraud risk applies to every closing: Verify wiring instructions by calling the title company at a phone number you found independently, not from an email. If wire fraud intercepts your closing funds, the funds may not be recoverable.
After Closing
- File your homestead exemption: Submit Form 50-114 to the county appraisal district before May 1 of the year for which the exemption is requested, per the Texas Comptroller. If you acquire the property after January 1, you may receive the exemption for the applicable portion of that tax year if the prior owner did not receive the same exemption. Filing activates the $140,000 school district exemption. The 10% annual appraisal cap under Texas Tax Code Section 23.23 takes effect on January 1 of the tax year following the first year the owner qualifies for the homestead exemption. A late application may be filed up to two years after the deadline.
- Additional exemptions for age 65 and over: Tax Code Section 11.13 requires school districts to provide an additional $60,000 residence homestead exemption for homeowners age 65 and over or disabled.
- Protest your appraisal: After receiving your appraisal notice, you have until May 15 or 30 days after the notice date, whichever is later, to file a protest. Use the property tax protest guide to prepare.
- Set up homeowners insurance: Choose coverage before closing and keep the policy current to protect your investment.
- Keep your settlement statement: Store your settlement statement, deed, survey, and title policy. You will need the settlement statement for tax filing and the title policy if a title claim arises.
- Update your mailing address: Confirm your address with the county appraisal district so your tax bill arrives. Late or missed tax payments become delinquent after January 31.
Frequently Asked Questions
Does a cash buyer in Texas need title insurance?
An owner’s title policy is not required by law, per TDI. TREC contract Paragraph 6E states that the broker advises the buyer to have an abstract examined by an attorney or to obtain a title policy. The owner’s title policy protects the buyer’s equity against title defects, liens, and encumbrances discovered after closing.
Who pays the owner’s title policy in a Texas cash sale?
The TREC contract Paragraph 6A assigns this cost to either the buyer or the seller by checkbox. The assignment is a negotiated contract term. A cash buyer can offer to pay the owner’s title policy as a concession, or negotiate for the seller to cover it as part of the offer.
Do cash buyers need a survey when paying cash?
Whether a survey is needed depends on the TREC contract Paragraph 6C and the title company’s requirements. If the seller has a recent survey and a T-47 Affidavit or T-47.1 Declaration per Paragraph 6C, and the title company accepts it, a new survey may not be needed. If the title company requires a new survey or the contract assigns it to the buyer, the buyer pays for it.
Can a cash buyer skip the appraisal?
Yes. Without a lender, no one requires an appraisal. A cash buyer may still choose to order an independent appraisal to confirm the property’s market value before closing. This is a due-diligence decision, not a requirement.
Should cash buyers still get a home inspection?
Yes. The inspection is how you discover structural, mechanical, plumbing, electrical, roof, and safety issues before the option period expires. Without an inspection, you lose the primary opportunity to identify problems that could be expensive to repair after closing. No lender requires it for a cash deal, but skipping it increases your risk.
How fast can a cash buyer close in Texas?
The closing date is a negotiated term in the TREC contract per Paragraph 9A.
Can a cash buyer ask the seller to pay closing costs?
Yes. TREC contract Paragraph 12A allows the seller to contribute an amount toward the buyer’s expenses, and the owner’s title policy and survey are assigned by contract checkboxes in Paragraphs 6A and 6C. Each cost assignment is a negotiated contract term.
What costs differ between a cash buyer and a financed buyer?
A cash buyer does not pay loan-related charges such as origination charges, underwriting fees, a loan title policy with lender-required endorsements, and lender-required PMI/MIP. All other costs, including the owner’s title policy, recording fees, tax prorations, and survey, apply to both cash and financed transactions.
What should a cash buyer review on the settlement statement?
Review every line item: the owner’s title policy premium, settlement and escrow fees, recording fees, property tax proration, survey charge, HOA fees if applicable, and any credits from the seller. Compare the preliminary settlement statement to the final version before wiring funds. Confirm the wire amount, verify the wiring instructions by phone using a number you found independently, and keep the final settlement statement for your records.
Data and Methodology
Title insurance premiums in this guide are computed from the Texas Department of Insurance rate schedule effective March 1, 2026. Title insurance optionality references TDI guidance. Mortgage insurance classification references CFPB guidance. Contract provisions reference the Texas Real Estate Commission One to Four Family Residential Contract, Form 20-19. The no-transfer-tax provision is from Texas Constitution Article VIII, Section 29. Homestead exemption and appraisal cap references cite the Texas Comptroller of Public Accounts and Texas Tax Code Sections 11.13 and 23.23. Recording fees cite the Bexar County Clerk’s published fee schedule. No figures from commercial real estate portals, aggregator blogs, or unsourced industry estimates are used in this guide.
