Who Pays for What at an Illinois Home Closing?

 Posted on May 23, 2026 in Real Estate

Both buyers and sellers pay closing costs in Illinois, but they pay for very different things. In general, sellers tend to pay more in total because their share includes real estate commissions and transfer taxes. Buyers pay mostly for costs tied to their mortgage and title insurance. If you are buying or selling a home in 2026, working with our Grayslake, IL residential real estate lawyers can help you understand exactly what you will owe before you ever sit down at the closing table.

What Does the Seller Typically Pay When Closing a Home in Illinois?

Sellers in Illinois generally carry the larger share of closing costs. Examples include commissions, transfer taxes, and more.

Real Estate Commissions

The single largest expense for most sellers is the real estate agent commission. In Illinois, the total commission typically runs around five to six percent of the sale price, split between the listing agent and the buyer's agent. On a $300,000 home, that could be $15,000 to $18,000 coming out of the seller's proceeds.

Transfer Taxes

Under 35 ILCS 200/, the Illinois Real Estate Transfer Tax Act, there is a state transfer tax of $0.50 per $500 of the sale price. In Lake County, where Grayslake is located, there is an additional county transfer tax of $0.25 per $500.

On a $300,000 sale, the state tax would be $300, and the Lake County tax would be $150. Some municipalities also have their own local transfer taxes, so it is worth confirming whether additional local taxes apply to your specific address.

Owner's Title Insurance

By longstanding Illinois custom, sellers pay for the owner's title insurance policy that protects the buyer. This policy covers the buyer in case a problem with the property's ownership history surfaces after closing. Issues might include an undisclosed lien, a boundary dispute, or a recording error from years ago. The premium is based on the home's value and typically runs several hundred to over a thousand dollars.

Attorney Fees

Illinois does not legally require an attorney at a home closing. However, it is standard practice for both buyers and sellers to hire one. The seller's attorney prepares the warranty deed, coordinates the title work, and makes sure any existing mortgage is paid off and released before the title transfers.

Property Tax Credit to the Buyer

In Illinois, property taxes are paid in arrears, meaning you pay this year for last year's taxes. Because of that system, the seller owes the buyer a credit at closing that covers the portion of the current year's taxes that have built up while the seller still owned the home.

What Does the Buyer Typically Pay When Closing on a Home in Illinois?

Buyers in Illinois generally pay between two and five percent of the purchase price in closing costs.  Examples include loan fees, title insurance, escrow deposits, and more.

Loan-Related Fees

If you are financing your purchase, your lender will charge origination fees to process and underwrite your loan. These typically run between 0.5 and one percent of the loan amount. You will also pay for a home appraisal, which usually costs $400 to $700, and a credit report fee. These costs show up on your Loan Estimate, which your lender is required to give you within three business days of applying.

Lender's Title Insurance

Separate from the owner's title insurance the seller pays for, the buyer must purchase a lender's title insurance policy. This protects the lender's financial interest in the property and is typically required as a condition of getting a mortgage. It does not protect the buyer, only the bank.

Prepaid Items and Escrow Deposits

Prepaid items are not traditional closing costs but still require cash at closing. These include prepaid homeowner's insurance, prepaid mortgage interest from the closing date until your first payment, and initial deposits into your escrow account if your lender requires one for future property tax and insurance payments. Depending on timing, these prepaids can add up to several thousand dollars.

Home Inspection

A home inspection is not technically a closing cost. However, it is a cost that buyers almost always pay before the closing date. It’s typically $300 to $600, depending on the size of the property. While not legally required, it is strongly recommended.

Can Buyers and Sellers Negotiate Who Pays What in a Home Closing?

Most closing cost responsibilities in Illinois come from custom and practice rather than law, which means they can be negotiated between the parties. In a slower market, a seller might agree to pay some of the buyer's closing costs as a concession to get a deal closed. In a competitive market, buyers sometimes offer to take on certain costs to make their offer more attractive.

Whatever is agreed to should be spelled out clearly in the purchase contract, because what you negotiate upfront determines what appears on your closing statement.

Schedule a Free Consultation With Our Lake Forest, IL Residential Real Estate Closing Lawyers

Closing costs can add up quickly, and the last thing you want is to be surprised by a large number you were not expecting. The attorneys at Newland & Newland, LLP are local to Illinois and take pride in putting their clients and communities first. With many decades of combined experience, they understand the details that can make or break a smooth real estate transaction. A Grayslake, IL residential real estate attorney at Newland & Newland, LLP can walk you through your specific closing costs before closing day, review your settlement statement to make sure every number is correct, and make sure the transaction is handled properly from start to finish. You have worked hard to get to this point, and you deserve to understand exactly what you are signing. Call 847-549-0000 to get started.