Buying a condo in Downtown Brooklyn is exciting, but the closing statement can surprise you if you are not prepared. You may have heard about mansion tax or mortgage recording tax and wondered how they apply to your deal. You want clear numbers, a simple checklist, and confidence that you are not leaving money on the table. In this guide, you will learn what condo buyer closing costs include, how sponsor sales differ from resales, and what realistic ranges look like at common Downtown Brooklyn price points. Let’s dive in.
What closing costs cover in NYC condo deals
Closing costs are the one‑time expenses you pay at closing in addition to your down payment. In New York City, they tend to be higher than in many markets because of state and city taxes and lender and title requirements. For Downtown Brooklyn condo buyers, typical categories include the following:
- Mortgage and lender fees if you finance
- Taxes and government charges, including mansion tax and mortgage recording tax
- Title search, title insurance, and recording fees
- Professional fees, such as a buyer’s attorney and lender counsel charges
- Condo-specific fees, including application, move-in, and any reserve contributions
- Prepaids and escrows for property taxes, common charges, and insurance
Your exact costs depend on your purchase price, loan size, whether you are buying a resale or a new sponsor unit, and how your contract allocates certain taxes and fees.
Mortgage and lender fees
If you are financing, your lender will provide a Loan Estimate that itemizes expected fees. Always request this early, then compare lenders because rate and fee structures vary.
Common lender line items
- Application and processing: often a few hundred dollars to $1,000 or more, depending on the lender.
- Origination or points: may be a flat fee or a percentage of the loan. Ask for a clear rate and fee breakdown in writing.
- Appraisal: typically about $400 to $1,000 or more for NYC condos, based on size and complexity.
- Credit report, underwriting, flood search, and tax service: small items that add up, usually tens to low hundreds each.
- Escrows: many lenders collect two to six months of property tax or common charges at closing to seed your escrow account.
Mortgage recording tax
If you record a mortgage in New York City, a mortgage recording tax applies. It has state and city components and is based on your loan amount. This can add up to thousands or even tens of thousands at higher loan sizes. Confirm the current rules and any exemptions with your lender and the NYC Department of Finance.
Title search, title insurance, and recording
Title work confirms the seller’s ownership and checks for liens. You will typically purchase title insurance and pay recording fees when the deed and mortgage are filed.
- Title search and examination: varies with property history and complexity.
- Title insurance: most lenders require a lender’s policy. An owner’s policy is recommended. Premiums in New York State follow regulated rate tables and scale with purchase price and mortgage amount. For many Downtown Brooklyn condos, title costs run into the low thousands and rise for higher prices.
- Recording and settlement fees: county recording and small title-related fees often total in the low hundreds.
Title insurance is a one‑time premium paid at closing. Ask the title company for line-item premiums for both lender’s and owner’s policies.
Taxes and government charges
New York State mansion tax
If your purchase price is at or above $1,000,000, New York State charges a mansion tax. The rate increases in tiers at higher price brackets. By statute the buyer pays this tax unless the contract allocates it differently. Your attorney will calculate the exact amount based on the current state schedule.
Real property transfer taxes
New York State and New York City both impose transfer taxes on sales. In a typical resale condo deal, the seller pays these taxes. In sponsor sales, contracts often reassign some or all transfer taxes to the buyer, or the sponsor may offer credits that offset them. The contract governs who pays what, so review it closely with your attorney before you sign.
Property tax adjustments
Depending on your closing date, you will reimburse the seller for any property taxes or common charges they prepaid for the period after closing, or you will receive a credit if you are prepaying.
Condo-specific fees
Condominiums in Downtown Brooklyn may require a buyer application and move-in coordination. Fees vary by building, but these are common:
- Application or processing fees and background checks
- Move-in or move-out fees and refundable deposits for elevator protection or scheduling
- Capital contribution or reserve funding if required by building rules
- Proration of common charges based on the closing date
Always ask management for the current fee schedule and whether deposits are refundable.
Professional fees
In New York City, buyers commonly retain an attorney for condo purchases. Flat fees are typical and often reflect deal complexity.
- Buyer’s attorney: many standard condo transactions fall in the range of about $1,500 to $4,000. Sponsor contracts, complex titles, or unique condo issues can increase this.
- Broker commission: in most resale listings the seller pays brokerage fees. Confirm the arrangement for your specific property.
- Settlement or escrow agent and minor service charges: expect smaller amounts that appear on the closing statement.
Get attorney estimates before you sign the contract and confirm what is included.
Sponsor sales vs. resales in Downtown Brooklyn
Contract terms in sponsor sales can shift who pays major items. This is common in new-development condos across Downtown Brooklyn.
- Transfer taxes: sponsors sometimes absorb state or city transfer taxes, sometimes shift them to buyers, and sometimes offer credits. It depends on market conditions and the specific project.
- Sponsor fees: sponsor riders can include admin fees, condo attorney fees, and document charges that do not appear in resales.
- Move-in and reserve policies: new buildings may have capital contributions or structured move-in scheduling.
Action steps for sponsor deals:
- Ask the sales team for a written good faith estimate or sample closing statement.
- Have your attorney review the sponsor rider and all cost allocations before you sign.
- Confirm whether any concessions apply if you use a preferred lender or commit to a certain closing timeline.
Prepaids and escrows
Lenders often collect several months of property taxes and sometimes common charges at closing. You may also prepay the remainder of the current month’s interest, plus the first year of homeowner’s insurance if your lender requires it. These amounts depend on timing, your loan terms, and building policies, so they can vary widely even for similar units in the same neighborhood.
Downtown Brooklyn examples: What to budget
The following examples are educational ranges for buyer-paid items in Downtown Brooklyn. They assume a typical resale unless noted. Your numbers will vary based on loan size, title premiums, application fees, and how your contract handles taxes. One large line item, such as mansion tax or mortgage recording tax, can swing totals materially.
Scenario A: Condo at $650,000 (resale)
- Lender costs: about $1,200 to $6,000, depending on points and lender fees.
- Title search and title insurance: about $1,200 to $3,000.
- Recording and miscellaneous title or tax service fees: about $200 to $600.
- Buyer’s attorney: about $1,500 to $3,000.
- Condo application and move-in: about $200 to $1,000.
- Prepaids and escrows: about $2,000 to $6,000.
- Estimated out-of-pocket at closing, not including down payment: roughly $6,000 to $20,000.
Scenario B: Condo at $1,200,000 (resale, mansion tax applies)
- Lender costs: about $2,500 to $12,000 or more.
- Title insurance and recording: about $2,500 to $6,000 or more.
- Buyer’s attorney: about $2,000 to $4,500.
- Condo admin and move-in: about $300 to $1,500.
- Prepaids and escrows: about $3,000 to $12,000.
- Mansion tax: buyer-paid unless the contract states otherwise. The exact amount follows the current state schedule for $1M+ purchases.
- Estimated out-of-pocket at closing, including mansion tax but not your down payment: roughly $20,000 to $80,000 or more. Totals depend heavily on mortgage recording tax and the mansion tax calculation.
Scenario C: Sponsor unit at $2,500,000 (new development)
- Lender costs and mortgage recording tax: many thousands, based on loan size.
- Title insurance and recording: several thousand to tens of thousands, scaling with price and mortgage amount.
- Buyer’s attorney: about $3,000 to $8,000 or more, often higher for sponsor riders.
- Condo and sponsor admin fees, move-in fee, and possible capital contribution: often $500 to $10,000, subject to building rules.
- Mansion tax and transfer taxes: substantial line items. Sponsor contracts may allocate transfer taxes to the buyer or provide concessions.
- Estimated out-of-pocket at closing: highly variable. Expect tens of thousands up to several hundred thousand depending on contract allocations and concessions.
How to plan and reduce surprises
Use these steps to lock in your budget with fewer unknowns.
- Request a Loan Estimate from at least two lenders. Compare rate and fee structures, points, and mortgage recording tax estimates.
- Ask your attorney for a fee quote before contract signing. Confirm what is included and whether sponsor riders add cost.
- Get a title insurance quote. Ask for line items for both lender’s and owner’s policies.
- Confirm condo fees in writing. Request the building’s application, move-in, and deposit schedule.
- For sponsor deals, get a written good faith estimate or sample closing statement. Clarify who pays transfer taxes and any sponsor attorney or admin fees.
- Budget conservatively. NYC closings combine fixed fees and percentage-based taxes that scale quickly at higher price tiers.
The bottom line for Downtown Brooklyn buyers
Closing costs are manageable when you plan ahead and understand how your contract allocates taxes and fees. If you are shopping in the $1M to $2M range that is common in Downtown Brooklyn, mansion tax, mortgage recording tax, and title premiums will shape your number the most. In sponsor deals, one negotiated concession can offset a major expense. Bring your lender, attorney, and agent into the conversation early so you have accurate estimates before you sign.
Ready to map out your closing budget for a specific building or price point? Connect with Raquel Lomonico for a clear, data-informed plan and local guidance tailored to your Downtown Brooklyn condo search.
FAQs
Who pays mansion tax on a Downtown Brooklyn condo purchase?
- In New York State the buyer is responsible for mansion tax when the purchase price meets the threshold, unless the contract allocates it differently. Confirm with your attorney during negotiations.
How do sponsor sales change closing costs for condo buyers?
- Sponsor contracts can shift state or city transfer taxes and add sponsor admin or legal fees, while some sponsors offer concessions. Ask for a written estimate and review allocations with counsel.
What is mortgage recording tax and when does it apply?
- It is a tax on recording a mortgage in New York City that includes state and city components and is based on your loan amount. It can be significant, so verify the current rules and estimate with your lender.
How much does title insurance cost for a Downtown Brooklyn condo?
- Premiums follow New York State rate tables and scale with price and mortgage size. Many condo purchases fall in the low thousands for title costs, increasing for higher price points.
What should I budget as a first-time condo buyer under $1M?
- For a typical $650,000 resale condo, plan for about $6,000 to $20,000 in closing costs beyond your down payment, depending on lender fees, escrows, and building charges.
