Whether you are buying a golf course home in Las Cruces or a historic property near the university in Silver City, the closing table can bring some financial surprises if you aren't prepared.
Closing costs are the collection of fees, taxes, and administrative charges required to legally transfer a property. While everything in real estate is technically negotiable, below is a brief guide to how closing costs are typically split between the Buyer and the Seller.
Here is exactly who pays what in a typical 2026 transaction.
The Buyer's Side (Typically 2% to 5% of Purchase Price)
For buyers, closing costs are largely driven by the mortgage lender. If you are paying cash, your closing costs will be significantly lower.
When financing a home, buyers are usually responsible for:
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Loan Origination Fees: This is what your lender charges to process and underwrite your mortgage (usually 0.5% to 1% of the loan amount).
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Appraisal & Inspections: You pay third-party professionals to assess the home's value (usually $600+) and its physical condition ($350+).
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Pre-Paids & Escrow Setup: Your lender will require you to pay a few months of property taxes and the first year of homeowners insurance plus a few months upfront to fund your escrow account.
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Buyer Brokerage Compensation: Depending on your representation agreement and what concessions the seller offers, you may be responsible for compensating your Buyer's Broker.
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Lender’s Title Insurance: This policy protects the bank’s investment in the property.
The Seller's Side (Typically 6% to 8% of Sale Price)
Sellers generally carry a larger percentage of the closing costs in New Mexico, primarily because they cover the professional fees associated with marketing the home and ensuring the title is clear.
Sellers are usually responsible for:
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Brokerage Compensation: Real estate brokerage compensation is, and always has been, fully negotiable. Sellers negotiate brokerage compensation with the listing brokerage and sometimes will cover part or all of the Buyer's Brokerage compensation.
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Gross Receipts Tax (GRT): This is uniquely New Mexico! The state charges a tax on services rendered, which typically applies to the brokerage compensation. However, remember that every cost is negotiable, and there are exceptions (such as on foreclosed properties) where some sellers do not pay GRT.
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Owner’s Title Insurance: In New Mexico, it is highly customary for the seller to purchase the Owner’s Title Policy for the buyer, guaranteeing the home is free of hidden liens or legal claims.
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Prorated Property Taxes: Sellers pay the property taxes for the exact number of days they owned the home during the current calendar year.
Can Buyers Ask Sellers to Pay Their Closing Costs?
Yes. This is called asking for Seller Concessions.
In our current balanced market, it is becoming more common for buyers to request that the seller cover a portion of their closing costs. This strategy allows buyers to keep more cash in their pockets for moving expenses or immediate renovations, while still securing the property. However, strong negotiation is required to structure an offer that remains attractive to the seller.
The Bottom Line
Nobody likes surprise fees. Whether you are budgeting to buy your first home or calculating the net proceeds of your upcoming sale, knowing the numbers upfront is the best way to protect your wallet.
Let's run the numbers. Reach out today for an estimated net-out sheet and the estimated cost breakdown.
Andrew "Drew" Ahearn, REALTOR® | Associate Broker, Saenz & Smith Real Estate Co
(M) 575-323-1482 | (O) 575-386-2363 | drewahearnrealtor@gmail.com | View My Bio Here
