Zero down does not mean zero cash. Even on a physician loan that asks for no down payment, you still write checks at closing, and the total is usually larger than people expect.
Here is what those checks are for and roughly what they run.
The Three Buckets
Everything you pay at closing falls into one of three groups, and only one of them is genuinely negotiable.
Lender fees are what the bank charges to make the loan: origination, underwriting, processing, sometimes an application fee. These vary between lenders and you can shop them.
Third party and government costs are appraisal, title search, title insurance, settlement or attorney fees, recording fees and transfer taxes. Mostly fixed by the market or by your state.
Prepaids and escrow are not fees at all. They are your own money going into an account for property taxes and homeowners insurance, plus interest for the days between closing and your first payment. You would owe these whether you borrowed or paid cash.
People compare the total and conclude one lender is expensive when the difference is actually escrow timing. Compare the lender fee bucket separately.
What the Numbers Look Like
The most recent national study of purchase transactions puts average closing costs at $4,528 including recording charges and transfer taxes, or $2,993 without them, which works out to about 1.04% of the sales price on average and 0.85% at the median. That analysis covered more than 620,000 purchase quotes (LodeStar, published April 2026 on 2025 transactions).
Read that scope carefully. Those figures cover settlement, title and government charges. They do not include lender fees or your prepaid taxes and insurance, which is why the number on your actual closing statement will be higher.
Your state matters enormously. The same study found Delaware highest at 3.06% of sales price and South Dakota lowest at 0.39%, with Colorado at 0.50% and Iowa at 0.56%. On a $500,000 house that spread is roughly $15,300 versus $1,950 for the same transaction.
A Realistic Total on a Physician Loan
Put it together for a $500,000 purchase with zero down in a middle-of-the-road state:
| Item | Rough range |
|---|---|
| Lender fees | $1,000 to $3,000 |
| Appraisal | $500 to $900 |
| Title, settlement, recording, transfer tax | $3,000 to $6,000 |
| Prepaid homeowners insurance, one year | $1,500 to $3,500 |
| Property tax escrow, several months | $1,500 to $4,000 |
| Prepaid interest to the end of the month | $0 to $2,500 |
Call it $8,000 to $20,000 with nothing down. Insurance and property taxes are the swing factors and both are local.
What you do not pay on a physician loan is mortgage insurance, which on a conventional loan at this size would add roughly $190 to $625 a month on top of everything above.
Three Ways to Bring Less Cash
Seller concessions. Ask the seller to pay part of your closing costs. Programs cap this, commonly around 6% of the purchase price on a primary residence, and in a competitive market you may pay for the concession in the price. But it is the largest single lever and it is often overlooked.
Lender credits. Accept a slightly higher rate and the lender pays some of your costs. This is a real trade, not free money: you are financing the fees through the rate over the life of the loan. It makes sense when cash is your binding constraint and you expect to move or refinance within a few years.
Closing date timing. Prepaid interest runs from your closing date to the end of that month. Closing on the 28th instead of the 3rd can save most of a month’s interest. It is a small lever, it costs nothing, and almost nobody uses it.
Gift Funds
If family is helping, most programs accept gifts from an immediate family member for closing costs, with a signed gift letter stating the money is not a loan and does not need to be repaid. The funds usually need a documented paper trail from the giver’s account to yours.
Season the money early. A deposit that appears in your account a week before closing generates questions that a deposit from two months ago does not.
Read the Loan Estimate, Then Read It Again
Within three business days of your application, every lender must give you a Loan Estimate on the same standard form. That is not a courtesy, it is federal law, and it exists precisely so you can compare lenders line by line.
Page 2 is the one that matters. Section A is what the lender is charging you. Sections B and C are third party services, some of which you can shop for. Sections F and G are prepaids and escrow, which are your own money.
Compare section A across lenders. That is the real price difference. Everything else is largely the same transaction.
Where to Go From Here
Ask every lender for a Loan Estimate, not a verbal quote, and ask what they charge in lender fees specifically. Then budget eight to twenty thousand dollars of cash for a mid-priced home and adjust for your state.
If you would rather not collect quotes from five banks, tell us your degree, your training stage, your state and your numbers, and we will match you with the lender whose program fits. It takes about two minutes and costs you nothing.
Last verified September 10, 2026. Closing cost averages from the LodeStar 2026 Purchase Mortgage Closing Cost Data Report covering 2025 transactions. Mortgage insurance ranges from the Urban Institute Housing Finance Policy Center. Ranges in the table are typical rather than quoted figures and vary by state and lender.