---
title: "Who Pays Closing Costs on a New Construction Home?"
description: "On a new construction home the buyer pays most closing costs; the builder covers seller-side items and often credits part of yours if you use its preferred lender."
published: "2026-06-29"
canonical: "https://blog.saltharborrealestate.com/blog/who-pays-closing-costs-on-a-new-construction-home"
author: "Everitt Gill"
---

On a new construction home, the buyer pays most of the closing costs, the same lender fees, title charges, prepaids, and escrows that any buyer covers. The builder, acting as the seller, pays the seller-side items (in Nassau County that customarily means the owner's title insurance policy and the documentary stamp tax on the deed), and many builders also offer to cover part of your closing costs on top of that, almost always on the condition that you finance through their preferred lender and close with their title company.

That last condition trips up most first-time new-build buyers I meet out in Yulee. The model-home sign reads "Up to $15,000 toward closing," and the natural read is free money. It is real money. It just arrives with a string, and the string is the loan.

Worth knowing before you tour: almost none of this is happening on Amelia Island itself. The barrier island is close to built out, so the production-builder inventory that advertises big closing-cost credits sits on the mainland, in Yulee subdivisions and master-planned communities like Wildlight along the SR 200 corridor. That is where the question actually comes up.

## So who pays what at a new-build closing?

Split the costs into two columns. The buyer pays everything tied to the loan and the transfer of ownership: origination, appraisal, underwriting, the lender's title policy, recording, and the prepaid insurance and tax escrows. The builder pays the seller's customary items plus whatever credit it has put in writing. In this part of Florida the seller covers the owner's title policy and the deed's doc-stamp tax by long-standing custom.

| Closing cost | Who customarily pays (Nassau County new build) |
|---|---|
| Loan origination, appraisal, underwriting, credit report | Buyer |
| Lender's title policy and settlement fee | Buyer |
| Owner's title insurance policy | Builder (seller) |
| Documentary stamp tax on the deed | Builder (seller) |
| Recording fees and mortgage-related state taxes | Buyer |
| Prepaid homeowners insurance and property-tax escrow | Buyer |
| Builder administrative or transfer fee | Buyer |
| Buyer's agent commission | Builder (built into price) |

For what each of those lines actually is and the dollar ranges to expect on a local build, see our breakdown of new-build closing costs. Here the only question is whose name the charge lands next to, and that is settled first by Florida custom, then adjusted by whatever the builder wrote into your contract.

## Why do builders offer to pay your closing costs?

A credit protects two things the builder cares about: the sticker price and the lender pipeline. A builder would rather hand you $12,000 toward closing than cut $12,000 off the contract, because the recorded sale price becomes the comp for the next dozen homes in the section. Drop the price and you soften every appraisal behind you. Credit the closing costs and the headline number holds.

The second reason is the lender. Most national builders run an in-house mortgage company or partner with a preferred lender, and the closing-cost credit usually only applies if you use it. That loan earns origination fees and, often, a servicing relationship, so the help pays the builder back. None of that makes the credit a bad deal. It makes it a deal you have to check. Pull a Loan Estimate from an outside lender and weigh the builder's credit against a lower rate over the years you actually plan to keep the loan. A larger credit paired with a quarter-point-higher rate can cost more by year four.

## Can the builder make you use its lender and title company?

No, not outright. Under the federal Real Estate Settlement Procedures Act (RESPA Section 9), a seller cannot require you to buy title insurance from a particular company as a condition of the sale. A builder can still attach its closing-cost credit to using its preferred lender, which is legal and routine. So the incentive is optional on paper and load-bearing in practice: decline the builder's lender and you usually forfeit the credit, even if your own lender quotes a better rate.

The move is to price both paths. Get the builder's full incentive sheet in writing, get a competing Loan Estimate, and compare the all-in cost over your real holding period, not just the cash due at the table.

## Can you negotiate who pays closing costs on a new construction home?

Yes, and timing is the lever. Builders bend most on standing inventory, the spec and move-in-ready homes they want off the books, at the end of a fiscal quarter, and when a community is selling out its final phase. On those homes you can often push for more closing-cost help, a rate buydown, or design-center credits instead of a lower price.

Two things protect you here. Bring your own agent, because the friendly rep at the model home works for the builder and is paid to hold the price. Builders generally still pay the buyer's agent, with the commission built into the home's price, but since the August 2024 changes to how buyer-agent compensation is handled, confirm the amount in your written buyer-broker agreement and the builder's agent-registration terms before you tour. A buyer's agent who has closed in these Nassau County communities is the cheapest protection you will get on a six-figure purchase, which is exactly the seat we fill at Salt Harbor.

So the short version holds. You pay your costs, the builder pays its costs, and the headline credit is the builder's money, offered to move your loan onto its lender. Read the incentive sheet line by line, get one competing quote, and decide whether the credit really beats a lower rate. The free part is rarely free. It is just priced somewhere you have to go looking for it.