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What are transfer taxes on a Loan Estimate?
Updated November 2026 · Every dollar figure is an illustrative example, not a quoteTransfer taxes are a tax the state, county or city charges when a property changes hands, usually a percentage of the sale price, and they range from nothing in about a dozen states to more than 1% of the price in some cities. They are in Section E, the lender must get them right, and the amount on the Loan Estimate cannot go up at closing.
Where it is on the form
Page 2, Section E, Taxes and Other Government Fees, as Transfer Taxes, below recording fees. On a refinance the line is often blank because most places tax the transfer of ownership, not a new loan; a few states tax the mortgage itself, and that tax appears here too.
Texas, Missouri and roughly ten other states have no real estate transfer tax. Many states charge a fraction of a percent. Pennsylvania's state-plus-local rate commonly totals around 2% split between buyer and seller; New York City, Philadelphia and some other cities add their own. Some states tax the recording of the mortgage itself at a fraction of a percent of the loan. Whether the buyer or seller pays is set by state law, local custom and the purchase contract.
The reason transfer taxes get zero tolerance when recording fees get 10%: the tax is set by law and known in advance, so the lender has no excuse for estimating it wrong. That protection is worth something in a high-tax city, where a mistake could be thousands.
Check whose share the estimate shows. In a state where custom puts the whole tax on the seller, your line should read zero; in a split state it should be your half. If your Loan Estimate shows the full tax and the contract says the seller pays it, the estimate is overstating your cash to close, and the lender should correct it.
Can you shop for it?
No. It is a tax. The only levers are the purchase contract, which can assign the tax to the seller where local custom allows, and first-time-buyer or other exemptions some states offer.
Can it change between the Loan Estimate and closing?
Zero tolerance, by name in the rule. Transfer taxes on the Closing Disclosure cannot exceed those on the Loan Estimate unless a real change (a different sale price, a different property) led to a revised estimate. A lender that got the tax wrong pays the difference.
Questions to ask the lender
- Does this line show my share of the transfer tax, the seller's, or both?
- Is there a first-time-buyer or other exemption in this state or city that applies to me?
- On a refinance: does this state tax the mortgage itself, and is that what this line is?
Red flags
- The full transfer tax on your estimate when the contract or local custom puts it on the seller.
- A transfer tax line in a state that has none.
- A transfer tax that is higher on the Closing Disclosure with no change to the price or the property.
Questions people ask
Which states have no transfer tax?
About a dozen, including Texas, Missouri, Indiana, Mississippi, Montana, New Mexico, North Dakota, Utah, Wyoming, Idaho, Alaska and Louisiana (Kansas and, outside one county, Oregon have none either). A few others, and some cities and parishes, charge only a small documentary fee. Rules change, so confirm with the title company for your county.
Who pays transfer tax, buyer or seller?
It depends on the state and local custom. In many states the seller pays; in some it is split; in a few the buyer pays. The purchase contract can shift it where the law allows. Your Loan Estimate should show only your share.
Do I pay transfer tax on a refinance?
In most states, no, because nothing is being transferred. A few states tax the mortgage document itself, at a fraction of a percent of the loan amount, and that tax does apply to a refinance.
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Check my quoteEvery dollar figure on this page is illustrative. Fee ranges are general observations, not a survey or a quote, and are not a loan offer, approval, commitment to lend, or Loan Estimate. Your actual rates and fees depend on qualification with lenders, your state and county, and your closing date. The tolerance rules described are the federal TRID rules in general terms; the rule itself and your own Loan Estimate and Closing Disclosure decide how it applies to your loan. comparemyloan does not negotiate with lenders, lock rates, or take loan applications.