By Larry Higgins, MS, CFM · Mortgage Loan Originator · NMLS #2530499
Which state fees the seller pays, what changed in July 2025 for sales over $1 million, and where a buyer's own costs show up on the Loan Estimate. Every rule below is cited to the agency that sets it.
According to the New Jersey Division of Taxation, the seller is statutorily responsible for the Realty Transfer Fee and, on sales over $1 million, the Graduated Percent Fee. The Graduated Percent Fee replaced the 1% fee on buyers (the "mansion tax") under P.L. 2025, c. 69, for deeds submitted for recording on or after July 10, 2025; the parties can still agree in the contract to split costs differently. A buyer's own closing costs, such as lender charges, the appraisal, title insurance, recording fees and prepaid taxes and insurance, are itemized on page 2 of the Loan Estimate required by federal Regulation Z.
The New Jersey Division of Taxation states that the seller pays the Realty Transfer Fee when a deed is recorded. The Division says the fee is calculated on the amount of consideration recited in the deed or, in certain cases, on the property's assessed value divided by the Director's Ratio.
The Division publishes the fee in rate tables. For example, its schedule for sales above $350,000 lists a fee of $4,175 on a $500,000 sale with no exemption. The tables also show lower amounts for sellers who qualify for a partial exemption.
Before July 10, 2025, a 1% fee on residential sales over $1 million, often called the mansion tax, was imposed on the buyer. In a July 2, 2025 memorandum, the Division of Taxation explained that P.L. 2025, c. 69, enacted June 30, 2025, turned that 1% fee into a Graduated Percent Fee and moved it from the buyer (grantee) to the seller (grantor), for deeds submitted for recording on or after July 10, 2025.
The memorandum says the fee is a percentage of the entire consideration, not only the part above each threshold. Its own example: a $2,750,000 sale falls in the 2.5% bracket, for a fee of $68,750. The memorandum also describes a one-time transition refund: on a sale over $2 million with a contract fully executed before July 10, 2025 and a deed recorded by November 15, 2025, the seller could claim back any fee paid above 1% of the price.
The Consumer Financial Protection Bureau describes closing costs as the fees for getting the loan and completing the purchase: for example, appraisal fees, title insurance, government taxes and fees, and prepaid items such as property taxes, homeowners insurance and interest until the first payment. The CFPB notes that sellers may cover some of these, depending on the contract or state law.
Under Regulation Z (12 CFR 1026.37), the lender's Loan Estimate lists the buyer's costs on page 2: lender and broker charges in Section A, required services in Sections B and C (such as the appraisal and title services), taxes and government fees in Section E, prepaids in Section F and the initial escrow deposit in Section G. Seller credits appear in the Calculating Cash to Close table.
Read the purchase contract to see which costs each side has agreed to pay; the Division of Taxation's rules set who is legally responsible to the state, but the contract controls who bears the cost between buyer and seller. Then compare the Loan Estimate with the Closing Disclosure you receive at least three business days before closing, as required by 12 CFR 1026.19(f).
Not for deeds recorded on or after July 10, 2025. According to the NJ Division of Taxation, P.L. 2025, c. 69 replaced the 1% fee on buyers with a Graduated Percent Fee imposed on the seller, from 1% to 3.5% of the entire price on sales over $1 million. The buyer and seller can still agree in the contract to allocate the cost differently.
The seller. The NJ Division of Taxation states that the seller is statutorily responsible for the Realty Transfer Fee and the Graduated Percent Fee.
The Division of Taxation's published fee schedule lists $4,175 on a $500,000 sale with no exemption. Qualifying seniors, blind or disabled sellers and low- and moderate-income housing pay a reduced fee, claimed on Form RTF-1.
It is a percentage of the entire consideration, based on the bracket the price falls in. The Division of Taxation's example: a $2,750,000 sale is in the 2.5% bracket, so the fee is $68,750.
On page 2 of the Loan Estimate your lender must provide under Regulation Z, and again on the Closing Disclosure you receive at least three business days before closing.
Have a specific scenario? Talk it through with a licensed loan officer.
(732) 561-4292Send a messageBased on New Jersey Division of Taxation guidance (including its July 2, 2025 memorandum on P.L. 2025, c. 69), the Consumer Financial Protection Bureau and Regulation Z. Fees and rules can change; confirm current amounts with the Division of Taxation, your attorney or your settlement agent. Reviewed September 2026. This guide is general educational information, not personalized financial, legal or tax advice, and is not a commitment to lend or a guarantee of approval, rate, cost or savings. Ai Remco LLC is a licensed mortgage broker, NMLS #2560393. All loans subject to credit approval, underwriting and property appraisal. Equal Housing Opportunity.
