Conventional construction loan closing cost estimator
First: a complete hypothetical worksheet on a $500,000 build ($100K land + $400K construction), organized like your Loan Estimate — every fee deliberately over-estimated. Then enter your own project cost and watch the same math scale. This is an educational estimate for a conventional one-time-close construction loan — clearly not a quote or a Loan Estimate.
Jim Blackburn · NMLS #1072866 · 7× Scotsman Guide Top Producer · $500M+ closed · (954) 993-1625
No one-time insurance charge rolled into closing
Reviewed by Jim Blackburn, NMLS #1072866.
No one-time MI charge
Conventional loans carry no financed, one-time mortgage-insurance charge at closing — nothing rolled into the loan the way some government programs add a one-time premium. That keeps the closing-cost math simpler.
PMI is monthly, and often removable
With less than 20% down, a conventional loan typically carries private mortgage insurance (PMI), paid monthly. It is not a closing cost — it is a monthly item — and it generally can be removed later as your equity grows. We walk you through how it fits your budget before you commit.
Seller/builder credit — up to 6%
A seller or builder can contribute toward your closing costs and prepaids (up to actual charges, never cash back). The exact cap depends on your down payment — commonly 6% on the larger down payments typical of construction loans, 3% with minimal down, and up to 9% at 25%+ down.
A complete hypothetical example — $500,000 build
$100,000 land + $400,000 construction in Florida — a genuinely nice home. Below is what a closing-cost worksheet can look like, organized the way your Loan Estimate organizes it. Every figure is hypothetical and deliberately on the generous side — your real numbers come on your real Loan Estimate.
| Section A — Origination & Lender Charges | Hypothetical |
|---|---|
| Underwriting fee | $1,495 |
| Processing fee | $995 |
| Document preparation | $495 |
| Section B — Services You Cannot Shop For | Hypothetical |
|---|---|
| Construction appraisal (as-completed value) | $1,200 |
| Final completion inspection | $350 |
| Draw inspections (5 × $150) | $750 |
| Credit report | $120 |
| Flood certification | $25 |
| Tax service fee | $85 |
| Section C — Services You Can Shop For | Hypothetical |
|---|---|
| Title insurance (owner's + lender's) | $3,000 |
| Settlement / closing fee | $795 |
| Survey | $650 |
| Pest inspection | $150 |
| Section E — Florida Taxes & Government Fees | Hypothetical |
|---|---|
| Documentary stamps on the note (0.35%) | $1,750 |
| Intangible tax (0.20%) | $1,000 |
| Recording fees | $350 |
| Section F — Prepaids & Escrows | Hypothetical |
|---|---|
| First year homeowner's insurance | $2,400 |
| Property tax escrow deposit | $1,200 |
| Builder's risk coverage (construction period) | $1,800 |
| Total hypothetical closing costs + prepaids | $18,610 |
| Seller/builder credit at 6% of $500,000 (cap varies by down payment) | $30,000 |
| Result: a 6% credit MORE than covers every cost above — credits can cover closing costs and prepaids up to actual charges (never cash back) | ✓ Covered |
Fully hypothetical illustration on a fictional property — deliberately over-estimated, not a quote, not an offer, and excluding financing costs that vary by scenario. Conventional interested-party contribution caps depend on your down payment. Your actual figures appear on your Loan Estimate.
Enter any total project cost — see the hypothetical math
Land plus construction, any number you're imagining. This scales the same over-estimated hypothetical worksheet to your figure and shows what a seller/builder credit does to it. Estimates only — never a quote. For your real figures, review your Loan Estimate with our team; reviewed by Jim Blackburn, NMLS #1072866.
Conventional (conforming) loans follow Fannie Mae and Freddie Mac guidelines and carry no financed, one-time mortgage-insurance charge at closing; any private mortgage insurance is a monthly item, not a closing cost. Every figure on this page is a hypothetical, deliberately over-estimated illustration — not a quote, not a Loan Estimate, and not an offer. Your actual costs appear on your official Loan Estimate. Jim Blackburn, NMLS #1072866. This page is educational and is not a commitment to lend or a guarantee of approval.