Closing costs in Chicago, itemized

The transfer taxes, and how the stamps are computed

Transfer taxes are quoted as percentages for convenience, ours included, but that is not how the ordinances write them and not quite how the dollars land. The law sells stamps by the unit: the state charges $0.50 for each $500 of price or fraction thereof, Cook County charges $0.25 per $500 or fraction, and Chicago charges $3.75 per $500 or fraction from the buyer plus a $1.50-per-$500 CTA portion from the seller. The phrase or fraction thereof is the whole trick: the price is rounded up to the next full $500 before multiplying, so a fraction of a unit costs the same as the whole unit.

A reading note, because this catches nearly everyone: those percentages are each government’s bite of the sale price, so they are not supposed to add up to 100%. Stacked, they come to 1.20% of the price, and the thing that does add to 100% is the price itself; on a $500,000 Chicago sale, $6,000 of it becomes transfer tax and the other 98.8% stays in the deal. If you instead slice the tax pot by who collects it, that pie does total 100: the city keeps 62.5 cents of every stamp dollar, the CTA 25, the state 8.3, and the county 4.2.

Worked on an odd price, so the mechanics show: a $412,300 Chicago sale is 825 units, because 412,300 divided by 500 is 824.6 and fractions round up, so it is taxed as if the price were $412,500. The buyer’s city stamp is 825 × $3.75 = $3,093.75; the seller pays 825 × $0.50 = $412.50 to the state, 825 × $0.25 = $206.25 to the county, and 825 × $1.50 = $1,237.50 for the CTA portion, $1,856.25 in all. The flat-percentage shortcut would have said $3,092.25 for the buyer; the stamp math says $1.50 more. Small money, but it is why the title company’s figure beats every online percentage, and on a round-number price (anything divisible by $500) the two agree exactly.

Mechanically, nobody licks a stamp anymore: the transfer declaration is e-filed through the state’s MyDec system, and the title company collects and remits the state, county and Chicago amounts at closing. One more piece of history: the 2024 referendum that would have made Chicago’s rate graduated by price tier failed, so the city’s rates remain flat per-$500 as shown. Suburban stamps are their own world, next section.

Suburban stamps: every ordinance is its own animal

Outside Chicago the state and county lines still apply everywhere, and then each municipality decides for itself whether to add a stamp, how big, in what units, with what rounding, and on which side of the table. The four examples in the calculator above show the whole range: Evanston charges the seller on a graduated scale ($5 per $1,000 up to $1.5 million, $7 to $5 million, $9 above); Oak Park charges the seller $8 per $1,000 rounded to the nearest thousand rather than up; Berwyn charges the seller $10 per $1,000 and will not issue stamps until a city pre-sale inspection passes, the water reading is final, and every debt to the city is paid; and Naperville flips the table entirely and charges the buyer $1.50 per $500. Plenty of towns charge nothing at all.

The procedural half matters as much as the rate: suburban stamps are usually purchased from village hall before closing, several towns want the application a week or more ahead, and the inspection-first towns can hold up a closing over an unpermitted water heater. The Multi-Board contract handles the money side cleanly, whoever the local ordinance names pays, and our contract guide shows the paragraph. For any specific town, the title underwriter ATG keeps a public, current ordinance-by-ordinance list; it is the same reference the closers use, at atgf.com. Your attorney and our team check the local rule the day the contract is signed, not the week of closing.

What the buyer pays, beyond the down payment

Budget around two percent of the price on top of your down payment, plus the escrow deposits your lender collects. Here is where it goes on a $400,000 financed Chicago purchase:

Then the escrows: most lenders collect the first year of home insurance plus a cushion of property taxes and insurance up front, often several thousand dollars. It stings on the settlement statement, but it is not a fee; it is your own money, parked in your own escrow account, prepaying bills you would owe anyway. Points, if you choose to buy your rate down, are the other variable, and our rates guide explains that trade.

Two costs buyers fear but rarely pay here: the owner’s title policy (Illinois custom puts it on the seller) and the survey (also the seller, on houses). And the earnest money you sent at contract is not an extra cost at all; it comes back to you at closing as part of your down payment.

What the seller pays, before the payoff

The seller side is fewer lines but bigger ones. On a $500,000 Chicago house, with the brokerage line at the 5% negotiated in this example (there is no set rate; every listing agreement is negotiated):

Call it seven to eight percent of the price in this example, most of it the negotiated brokerage line and the tax credit. The mortgage payoff is not a cost, it is your own balance, requested to the exact day by the title company, paid out of proceeds, and released. In Chicago your attorney also clears the city items before the deed records, including proof the water account is paid. Before you list, we turn all of this into a one-page net sheet for your actual home and price; the sellers FAQ covers the rest of the process.

The property tax credit, explained

Cook County bills property taxes in arrears: the bill for this year arrives next year. So at closing, the seller credits the buyer for the stretch the seller owned but will never be billed for, and the buyer then pays the full bills when they come. The contract sets the credit as a negotiated percentage of the most recent bill, commonly around 100 to 110 percent, the cushion covering the way reassessments drift upward.

The arithmetic, on a $9,000 most-recent bill at 105%, closing July 1: $9,000 × 1.05 × 181/365, about $4,690, plus any prior-year amount not yet billed. It is the line that shocks first-time sellers and delights first-time buyers, and it is neither a fee nor a negotiating loss; it is simply your share of a bill that was always coming. Buyers should note the flip side: that credit is not spending money, it is earmarked for the tax bill that will arrive with your name on it.

Condos, tenants, and other special cases

Condos. The seller skips the survey but adds the association paperwork: the disclosure package for the buyer, a paid assessment letter proving the account is current, and often a move-out fee set by the building. The buyer’s lender sends the association a condo questionnaire, and the answers decide how smoothly the loan goes; our glossary explains the warrantable question that hides inside it.

Tenant-occupied. The lease survives the sale and binds the new owner, and Chicago notice rules govern the timing, so the closing plan and the tenant plan have to be written together. The renters FAQ covers the tenant side of that same coin.

Investors. Flipping a property means paying most of these lines twice, once buying and once selling, which is exactly why they are itemized inside our house flip calculator; run a deal through it and the closing costs compute themselves on both ends.

Questions we hear every week

Can closing costs be negotiated?

Several lines, yes. Brokerage compensation is negotiated by definition. Sellers can offer credits toward a buyer’s closing costs, common in slower seasons and with first-time buyers. Attorney fees are flat and quoted up front. What does not move: the transfer taxes, which are set by statute and ordinance.

Who pays the buyer’s broker?

Whatever the parties agree in writing, which is the whole answer since the 2024 industry changes. A seller may offer buyer-broker compensation as part of marketing the home, a buyer may pay their own broker under their representation agreement, or the two get negotiated inside the offer itself. We put every option and number in writing before anyone commits.

Are closing costs tax deductible?

Mostly no, with a few famous exceptions that depend on your situation (points on a purchase loan, prorated property taxes, and, for sellers, most selling costs reduce your gain). That is accountant territory, and we say so rather than guessing; bring the settlement statement to yours at tax time.

What paper tells me the real number?

Buyers get a Loan Estimate within days of applying and a Closing Disclosure at least three business days before closing; sellers get the net sheet from us and the settlement statement from the title company. Read the Closing Disclosure against the Loan Estimate; big drifts have to be explained, and your attorney will make them explain.