Florida Real Estate, Defined: The Closing Cost Glossary

The first time most buyers see a Florida closing statement, it runs two or three pages of line items with short labels and long numbers. Sellers get their own version. Every line has a name, a reason and a party who customarily pays it, and once you know the vocabulary the statement reads much faster. This glossary covers the terms you will see on a typical Central Florida resale closing, from Winter Garden and Clermont to Kissimmee and Davenport.

We are leaving dollar amounts out on purpose. Rates, premiums and fees change, and your closing agent and lender will give you the real numbers for your deal. What follows is what each item is and where it usually lands.

The Documents That Show Your Costs

Loan Estimate. The lender's early summary of what your loan and closing will cost, issued after you apply. Use it to compare lenders.

Closing Disclosure (CD). The final version of those loan terms and costs for a financed buyer. You receive it before closing, and Step 31 of our series covers its timing rules.

Settlement statement. The closing agent's itemized list of every debit and credit for buyer and seller. Many Florida title companies use the ALTA format. Cash buyers in ChampionsGate or Davenport get a settlement statement even though there is no CD.

Paid outside closing (POC). A cost you already paid directly, such as an inspection or an appraisal paid upfront. It still appears on the statement for the record, marked POC.

Government Taxes and Recording Fees

Documentary stamp tax on the deed. A Florida tax on the transfer of real property, based on the sale price. Under Paragraph 9(a) of the Florida Realtors/Florida Bar AS IS contract, the seller pays it, along with any surtax.

Documentary stamp tax on the note. A separate Florida tax on the promissory note when a buyer finances. The contract places taxes on notes and mortgages on the buyer.

Intangible tax on the mortgage. A one-time Florida tax on a new mortgage recorded against the property. Also a buyer cost when there is a loan. Step 30 of our series walks through both taxes in detail.

Recording fees. The county clerk's charge to put the deed and mortgage in the public record. The buyer pays to record the deed and mortgage. The seller pays to record anything needed to clear title, such as a lien release.

Title and Closing Agent Charges

Owner's title policy. Insurance that protects the buyer's ownership for as long as they or their heirs own the home. Paragraph 9(c) of the contract decides who pays. In Orange, Lake, Osceola and Polk counties the seller customarily pays, and the party who pays usually picks the closing agent.

Lender's title policy and endorsements. Insurance that protects the lender's loan, plus add-on coverages the lender requires. A buyer cost on financed deals.

Title search. The review of public records that the title commitment is built on. It travels with the owner's policy in the contract.

Municipal lien search. A check for unrecorded city or county liens, such as unpaid utility charges or code liens, that would not show up in the regular title search.

Closing services (settlement fee). The closing agent's fee for running the closing. Florida law defines closing services separately from the title premium, and under the contract each party pays its own.

Lender Charges and Prepaids

Origination fee. The lender's charge for making the loan. Labels vary by lender.

Discount points. An optional upfront payment to the lender in exchange for a lower interest rate.

Appraisal and credit report fees. Third-party costs the lender orders and the buyer pays, often POC.

Prepaids. Costs paid at closing for time after closing, mainly the first year of homeowners insurance and any interest owed from the closing date to the end of that month.

Initial escrow deposit. A starting balance the lender collects for your escrow account so it can pay future property tax and insurance bills on your behalf. It is your money, held for those bills.

Flood insurance. Required by the lender when the home sits in certain flood zones and optional elsewhere. Worth pricing early in parts of Kissimmee and St. Cloud near the lakes and wetlands.

Association, Proration and Credit Lines

Estoppel certificate fee. The charge for the HOA or condo association's official statement of what the seller owes. The contract places estoppel fees on the seller. Our explainer on the estoppel letter comes later in this series.

Application or transfer fee. An association's charge to approve or process a new owner. A buyer cost under the contract. Some Horizon West and Windermere communities also charge a capital contribution at transfer, so read the association documents for who pays it.

CDD assessment. A Community Development District charge that appears on the property tax bill in many newer Central Florida neighborhoods. It can show up on the statement as a proration or a payoff.

Prorations. Splits of recurring bills between buyer and seller as of the day before closing. Florida property taxes are billed for the calendar year and paid after the year is underway, so the seller usually credits the buyer for their share of a bill the buyer will later pay. HOA dues work the same way in either direction.

Seller credit or concession. An amount the seller agrees to put toward the buyer's costs. Lenders cap how much they allow, so confirm the limit with your loan officer before you write it into an offer.

Home warranty. An optional service plan for systems and appliances. Paragraph 9(e) of the contract lets the parties choose who pays and set a maximum.

FIRPTA withholding. Federal withholding that may apply when the seller is a foreign person. A seller cost under the contract, and common in Davenport and ChampionsGate vacation home sales.

Read Your Statement With Us

The Bella Trae Realty team reviews the settlement statement line by line with every client before closing day, so the numbers match the contract and nothing new appears at the table. If you are buying or selling anywhere from Ocoee to Minneola, contact Bella Trae Realty today and we will walk you through the costs on your specific deal. Bella Trae has helped buyers and sellers across Central Florida read these statements with confidence.

This post is general education, not legal, tax or lending advice. Confirm current figures and terms with a licensed Florida professional.

Up Next: On Monday, the step-by-step backbone of the series picks back up with the next Transaction Step, following a Central Florida purchase from contract toward closing.