Closing Costs in North Dakota: What Buyers Actually Pay

North Dakota does not tax you at the closing table the way most states do. There is no state real estate transfer tax and no sales tax on real property — a fact that saves buyers thousands compared to states where transfer taxes scale with the purchase price. But the state's abstract-of-title system adds costs that out-of-state buyers consistently fail to anticipate. Here is an accurate breakdown of what closing actually costs in North Dakota and who pays what.

The Headline Number

Overall closing costs in North Dakota average approximately 4.02% of the home's purchase price. For a $250,000 property, expect total closing costs — from both buyer and seller sides combined — of roughly $10,000 to $11,000. The buyer's share of that is typically $5,000 to $7,000, depending on the loan type and how costs are negotiated in the purchase agreement.

The Standard Closing Cost Breakdown

Abstract Update (Customarily Seller)

North Dakota maintains a physical abstract-of-title system. The seller is responsible for locating the existing abstract for the property and delivering it to a licensed abstract company for updating — a process that captures all new recorded activity (deeds, liens, easements, tax records) since the last transaction.

Abstract continuation fees are regulated: a $191 base certificate fee plus per-entry and per-name search charges. Total seller cost typically runs $200 to $400 for properties without complex title histories.

Attorney's Title Opinion (Customarily Buyer)

Before any title insurance policy can be issued in North Dakota, the law under N.D.C.C. § 26.1-20-05 requires a licensed North Dakota attorney to examine the updated abstract and issue a written opinion certifying that the title is marketable and identifying any defects that must be cured.

The buyer pays for this attorney review. Fees typically run $300 to $600 depending on the complexity of the title chain and the attorney engaged. This cost is unusual from the perspective of most other states and represents one of the genuine surprises for out-of-state buyers.

Title Insurance Premiums (Split — See Details)

Two title insurance policies are standard in a North Dakota transaction:

• Owner's Title Insurance: Protects the buyer against undiscovered title defects for as long as they own the property. By strong custom in North Dakota, the seller pays the owner's policy premium. On a $250,000 purchase, expect $1,200 to $1,800 for the owner's premium.
• Lender's Title Insurance: Required by any mortgage lender; protects only the lender's collateral position. The buyer pays this. On a $250,000 loan, expect $250 to $400.

Note that while the attorney's opinion is technically separate from title insurance, the insurance cannot be issued without it. The two work as a paired system.

Escrow / Settlement Fee (Split 50/50)

The title company charges a fee for managing the transaction — coordinating document execution, handling fund disbursement, and ensuring recording. This typically runs $400 to $800 total, customarily split equally between buyer and seller.

Government Recording Fees (Customarily Buyer)

North Dakota recording fees are set by statute under N.D.C.C. § 11-18-05.1:

• Documents of 1 to 6 pages: $20 flat fee
• Documents of 7 to 25 pages: $65 flat fee
• Documents over 25 pages: $65 plus $3 per page above 25

A deed and a mortgage are typically two separate filings. Most standard documents fall under 6 pages, so $20 each is common, for $40 total. However, if documents are improperly formatted (missing the required 3-inch top margin on the first page), a $10 penalty is added — and in some cases a blank cover sheet is appended, pushing a 6-page document into the $65 tier.

Home Appraisal (Buyer)

Required by virtually all mortgage lenders. Expect $500 to $700 in North Dakota. VA appraisals use the VA fee schedule, which may differ slightly.

General Home Inspection (Buyer)

$400 to $600 for a standard residential inspection. In rural areas with private wells or septic systems, budget for additional specialized inspections:

• Private well water testing: $150 to $300
• Septic system evaluation: $200 to $500
• Radon test: $100 to $200 (professional testing)

Radon is not optional in North Dakota. The state has elevated geological radon levels, and the deep insulated basements standard in North Dakota construction concentrate the gas. The EPA action threshold is 4.0 pCi/L. If elevated levels are found, mitigation system installation typically costs $800 to $1,500.

Lender Origination and Underwriting Fees (Buyer)

$1,000 to $2,500 depending on the loan amount and lender. This includes origination charges, underwriting fees, and any points purchased. For NDHFA FirstHome program loans, origination fee structures may differ — confirm with your specific NDHFA participating lender.

Prepaid Taxes and Insurance (Buyer)

Lenders require prepaid property taxes and homeowner's insurance to be deposited into escrow at closing. This typically runs $2,000 to $3,500 depending on the time of year, tax rate, and insurance premium.

Summary Table

The North Dakota Purchase Agreement

The residential purchase agreement formally initiates the transaction. A few North Dakota-specific mechanics to know:

Earnest money timing: Brokers are legally required to deposit earnest money into a designated trust account within 24 hours of receipt (or the next business day if received before a holiday or weekend). Failure to meet this requirement creates personal broker liability. Standard practice requires earnest money delivery within one to two business days of final acceptance.

Contingency periods: The inspection period typically runs 7 to 14 days. The financing and appraisal contingency generally requires 21 to 45 days. Total escrow period runs 30 to 40 days from mutual acceptance, though the abstract process can extend this.

Good Funds Law: Under N.D.C.C. § 47-34-02, closing agents cannot disburse from escrow until funds are verified as "good funds" — meaning wire transfers fully received and cleared. For amounts exceeding $50,000, wire transfer is required. Plan to wire your closing funds at least one business day before your closing date.

Reducing Closing Costs with NDHFA Programs

The NDHFA's Start program provides a credit equal to 3% of the first mortgage loan amount at closing, which can be applied toward the buyer's out-of-pocket cash requirements — covering some or all of the buyer-side closing costs outlined above. For a $240,000 loan, that is $7,200 in closing assistance.

The DCA program provides up to 3% of the purchase price or $3,000 (whichever is greater) as a zero-interest deferred loan — also applicable toward closing costs.

Both require homebuyer education course completion before closing and a minimum $500 personal cash contribution from the buyer.

If you want a full walkthrough of the closing process, how to negotiate the purchase agreement, and how NDHFA programs layer onto your closing cost math, the North Dakota First-Time Home Buyer Guide covers all of it with step-by-step worksheets.

See more North Dakota guides →