The Quick Read: Recordation costs are government charges for putting your new mortgage on the public record, and in some states they scale with the size of the new loan. The amount depends on your state, your county and what the state taxes. That can be the whole new loan or only the new money above your old balance. These charges are set by law, not by the lender, so they are the part of a quote you cannot shop around.
This article is national, and states appear only as illustrations. No single figure describes what recordation adds across the country. The useful question is how the cost is built, so you can read your own Loan Estimate.
Cash-out refinance estimate
The starting figures are an example value with a balance and a cash request in proportion. Replace them with yours.
Editable benchmark: 7.40% as of October 15, 2026 · Freddie Mac 30-year average via FRED®. A conventional market reference, not a cash-out refinance quote.
Illustrative starting assumptions: a $350,000 home value, a $193,000 current balance, the agency cap on a one-unit principal residence, a thirty-year term at the current Freddie Mac benchmark, and property taxes and insurance estimated at typical national rates. Every field is editable.
Illustrative estimate only — not a Loan Estimate, approval, quote, or commitment to lend. The rate field carries the weekly Freddie Mac thirty-year conventional benchmark, a market reference and not a cash-out refinance quote; a cash-out loan is priced by the lender at lock. The cash available is the loan the program cap allows less the balances paid off, before closing costs, which are not included. The HELOC line is the program’s combined loan-to-value ceiling applied to the same value and balance. Taxes and insurance are editable estimates. Licensed in sixteen states for consumer mortgages.
What Are Recordation Costs on a Cash-Out Refinance?
Recordation costs are the charges a state or county collects to record your new mortgage or deed of trust. They are not lender fees. Some are small flat charges. Others are taxes that rise with the amount you borrow, and on a large cash-out loan those can become a real line item.
Three different charges tend to get lumped together:
| Charge | What sets the amount | Where you see it |
|---|---|---|
| Recording fee | Flat; by document type or page count | Government fees section |
| Mortgage recording tax | Percentage of the debt secured | Often shown as a transfer tax |
| Transfer tax | Sale price, in states that apply it | Usually a purchase cost |
The labels matter because a refinance has no sale. A percentage-based mortgage tax can still appear under the transfer tax heading on your paperwork. Federal disclosure rules sort charges by how they are calculated, not by what the state calls them. A flat fee is a recording fee. A charge based on loan amount is classed as a transfer tax, even on a refinance.
If you are weighing this against a no-cash-out refinance, the program choice matters as much as the state. Lendmire’s cash-out refinance programs are arranged through wholesale lenders, and the government charges on your file come from where the home sits, not from which program you pick.
Why “High-Cost” Means Two Different Things
“High-cost” can mean a high-cost loan-limit area or a state with heavy recording taxes. They are separate ideas.
A high-cost loan-limit area is a county where the conforming loan limit is set higher because homes cost more. That affects how large a loan can be before it becomes a jumbo. It says nothing about recording taxes.
A high-cost closing state is a place where recording and related taxes add a lot to closing costs. Some expensive housing markets have light recording charges. Some modest ones have heavy ones. Cost of living and cost of closing do not move together.
Both can apply at once. A large cash-out loan in a high-tax state is where recordation shows up most.
How Does the Tax Base Work?
The tax base is what the state multiplies its rate by. In many states it is the new secured debt, meaning the full amount of the new mortgage, not only the cash you take out.
Take Virginia. Its statute taxes a deed of trust at a set amount per $100 of debt secured. Refinances get a reduced schedule, and the county tacks on a local share. The state calls it a tax on the privilege of using the recording system, not a property tax. It does not rise because your house is worth more.
Some states carve out the balance you already paid tax on. Maryland, for example, exempts a new mortgage to the extent it refinances no more than the unpaid principal of the existing loan, if given by the original mortgagor. Money borrowed above the old balance is new debt, and it is taxed at the standard rate.
That carve-out is why a cash-out refinance can cost more in recordation than a plain rate-and-term refinance in the same state. The cash-out increment is the taxable piece.
A Worked Example in Percentages
Say a home is worth 100 units. The old balance is 60 percent of value. You refinance to 75 percent of value, which sits under the 80 percent cap on a one-unit principal residence.
- Full-loan base: The tax applies to 75 percent of value.
- New-money base: The tax applies to 15 percent of value, the difference between the new loan and the old balance.
In the second case the taxable amount is one-fifth the size. The rate and county are the same. The state’s treatment of the carried-over balance changes the bill.
A larger cash-out narrows that gap. Suppose you refinance to 80 percent of value with the same 60 percent old balance. The new-money base is now 20 percent of value, a third larger than before. The more equity you pull, the more the tax on the increment adds.
How Do Recordation Costs Cut Into Your Cash Proceeds?
Recordation costs reduce the cash you walk away with, or they raise the loan balance. On a cash-out refinance, the costs either come out of the proceeds at closing or get financed into the new loan.
Financing them is allowed. The Fannie Mae Selling Guide lists financing closing costs, points and prepaid items among the acceptable uses of a cash-out refinance. Financed costs count toward the loan amount, so they count toward loan-to-value.
That is where the limit bites. Per the Fannie Mae Eligibility Matrix, maximum LTV on a conventional cash-out refinance is 80 percent on a one-unit principal residence and 75 percent on two to four units. Those are the conventional ceilings, and financed recordation counts against them the same way any other financed closing cost does.
Picture a borrower aiming for the full 80 percent. If recordation tax is financed, it takes up room under the cap. Either the borrower takes less cash, or pays the tax out of pocket and keeps the cash. Which is better depends on how much cash is needed and how much room the file has.
Two other effects are worth knowing:
- Loan size: Financed costs raise the principal, which nudges the monthly payment up slightly.
- Mortgage insurance: Any conventional loan above 80 percent LTV needs it. The cash-out cap keeps most primary-residence loans at or under that line.
Key Terms Defined
Recordation tax: A state or local charge for recording a mortgage, often based on the amount of debt secured.
Recording fee: A flat charge for filing a document, set by page count or document type, not loan size.
Transfer tax: A charge based on loan amount or sale price. It can show on a refinance when the state taxes the mortgage.
Tax base: The dollar amount a tax rate is applied to, such as the full new loan or only the new money.
Original mortgagor: The borrower who first took the loan. Some states tie the refinance exemption to this person, and sometimes a spouse.
LTV (loan-to-value): The new loan balance divided by the home’s appraised value.
How Do Virginia, Maryland and New York Differ?
They differ on what is taxed, who qualifies for relief, and how the tax is built. These three illustrate the range, and they are not typical of every state.
| State | Tax base | Refinance treatment | Watch for |
|---|---|---|---|
| Virginia | Debt secured | Reduced refinance schedule; local share added | Must certify the old debt |
| Maryland | Debt secured | Existing balance exempt for original mortgagor | Affidavit; changed title |
| New York | Mortgage amount | Several taxes; county and city vary | Lender may owe a slice |
Virginia. The refinancing instrument has to certify the recording reference of the original debt on which tax was paid. Counties post their own land-record fees, and some change fixed fees on a schedule.
Maryland. The exemption has to be claimed. The instrument carries a statement, or the borrower signs a sworn affidavit, giving the original mortgagor’s status and the unpaid principal being refinanced. If title changed since the original loan, the borrower may not qualify, and the full new loan could be taxed.
New York. The mortgage recording tax is an excise tax on recording a mortgage. It is a bundle of separate taxes, and the total depends on the county and city. The state’s tax form carries current rates and rounds the mortgage amount to the nearest hundred. For smaller residential properties there is a modest deduction from one component. One slice, the special additional tax, falls on the lender by statute for mortgages up to six residential units. In some cases, such as certain non-profit lenders, that slice shifts to the borrower. Counties can also elect their own mortgage recording tax. The state tax department published a notice when Otsego County added one effective January 1, 2025, so a rate that holds in one county may not hold in the next.
The takeaway: do not carry one state’s rule into another. Your title agent will compute the number for your county.
Can the Cost Be Financed on Other Loan Types?
It depends on the program. Rule-by-rule treatment differs, and the cash-out lane is the most flexible.
| Program | Recordation costs in new loan? |
|---|---|
| Conventional cash-out | Yes, as part of closing costs |
| Conventional limited cash-out | Limited cash-back rules apply |
| FHA Streamline | No; paid in cash or by lender credit |
| VA IRRRL | Yes, within the recoupment test |
Here is how each one works.
- Conventional cash-out: Closing costs can be financed, subject to the LTV ceiling above.
- Limited cash-out (rate-and-term): The loan pays off the existing first mortgage, closing costs and any purchase-money second lien. Only incidental cash comes back. Take out more, or pay off a non-purchase second lien, and the file is treated as a cash-out refinance with its lower LTV cap.
- FHA Streamline: It does not allow closing costs in the new mortgage. “Streamline” describes lighter documentation, not an absence of costs. A “no cost” version has the lender covering costs in exchange for a higher rate on the new loan, so the cost moves into the rate.
- VA IRRRL: Allowable fees, including recording charges, may be included, but the loan must pass a 36-month recoupment test. Recording charges sit in the numerator of that test. Lender credits can offset allowable fees in the calculation.
A streamline cannot give you cash out. If you want equity, you are in cash-out territory, and the recordation question is yours to size up.
Where Does the General Rule Break?
Recordation is not a fixed percentage anywhere you can safely assume. These are the edge cases that come up most often.
Rates vary inside a state. Counties and cities may add their own taxes. A figure quoted for one county may not hold ten miles away.
Fixed fees change. Counties adjust technology and filing fees on a schedule. A fee in an older estimate may not match today’s.
Unit count changes the tiers. New York treats one- to three-family homes and condo units differently from other property. Conventional cash-out LTV also drops to 75 percent on two to four units.
Title changes can void an exemption. In Maryland, the carve-out follows the original mortgagor, a spouse, a settlor of a qualifying trust, or someone who assumed the debt and paid tax on the purchase price. A borrower who added or removed names may lose it.
Seasoning rules apply first. For a conventional cash-out refinance, the first mortgage you pay off must be at least 12 months old, measured note date to note date. At least one borrower must have been on title for 6 months. Exceptions exist for delayed financing, inheritance and legal awards. Fail seasoning, and recordation is moot because the cash-out does not go forward.
CEMA structures exist in New York. A consolidation, extension and modification agreement carries over the old mortgage so part of the tax base is reduced. It adds its own paperwork and legal cost, and not every lender offers it. Ask your title agent whether it fits your file. It is a structure to price out, not a default.
Texas homesteads are different. A cash-out on a Texas homestead is capped by the state constitution.
How Do You Find the Charge on Your Loan Estimate?
Look at the “Taxes and Other Government Fees” section, labeled E, on page two of the Loan Estimate and Closing Disclosure. The CFPB explains that government recording charges are what state and local agencies assess for legally recording the deed, the mortgage and related loan documents.
Two things on that page help you:
- Tolerance: Those recording charges, together with certain other settlement services, generally cannot rise more than 10 percent in total between the estimate and closing.
- Classification: Under Regulation Z’s disclosure rules, charges based on loan amount or sale price are listed as transfer taxes, whatever the state calls them. Do not be surprised to see a transfer tax line on a refinance.
Compare Loan Estimates from different lenders with this in mind. Government charges should be the same for the same property. If two quotes differ, the gap lies in lender-controlled fees, not in recordation. Fannie Mae’s closing costs calculator page makes the same point: government fees are not negotiable.
What Does the Decision Look Like in Practice?
Work through it in this order.
1. Ask your title agent for the recordation estimate for your county before you decide how much equity to take.
2. Find out whether your state taxes the full loan or only the new money. That decides whether cashing out costs extra tax.
3. Check your title history. If a name has changed since the original loan, confirm any exemption still applies.
4. Decide whether to pay it or finance it. Financing uses room under the LTV cap and reduces the cash you can take.
5. Test the break-even. Weigh the added tax against what you plan to do with the cash. A paydown of higher-cost debt can justify it. A small draw may not.
A cash-out is not always the right tool. If you need a modest amount, a smaller cash-out, a different loan product or leaving the first mortgage alone may cost less in total. In a state with a refinance exemption, a refinance may owe little or no recordation tax at all. Cash-out is therefore partly a tax-cost question.
Tax treatment can depend on your situation; borrowers should speak with a qualified tax professional before relying on any deduction or credit.
If you are weighing a cash-out refinance against keeping the loan you have, Lendmire can help you compare the programs and the equity each one reaches. All program figures are subject to lender guidelines and full file review, and nothing here is a commitment to lend.
Frequently Asked Questions
Do I pay recordation tax on a refinance if I’m not selling?
It depends on your state. Some states tax the new mortgage whether or not a sale occurs. Others exempt the part that replaces your existing balance. Even where a transfer-style line appears on your paperwork, it reflects how the charge is calculated, not a sale.
Is the lender responsible for any of the recording charges?
Usually the borrower pays them. A few states assign a slice to the lender by statute, such as New York’s special additional tax on mortgages up to six residential units. Your Loan Estimate shows what falls to you.
Can I roll recordation costs into a cash-out loan?
On a conventional cash-out refinance, yes. Closing costs can be financed, but they count toward LTV. With the cap at 80 percent on a one-unit primary residence, financed costs may reduce the cash available to you.
Why did my cash-out cost more in recordation than my neighbor’s rate-and-term refinance?
In states with a refinance carve-out, the existing balance may be exempt and only new money is taxed. Your cash-out adds new debt, so more is taxable. Different counties and unit counts can widen the difference.
Can I shop around to lower recordation costs?
Not the government charges themselves. They are the same for the same property across lenders. You can compare lender-controlled fees on each Loan Estimate, and you can ask your title agent about structures like a CEMA where your state offers one.
For your own numbers, request a scenario review with Lendmire.
About Lendmire
Lendmire — NMLS# 2371349 — is a mortgage broker that arranges FHA, VA, conventional and jumbo home purchase and refinance financing in 16 states through wholesale lenders. Every option is subject to the lender’s guidelines and full underwriting. Scotsman Guide named Lendmire a Top Mortgage Workplace in both 2025 and 2026.
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References
1. Fannie Mae Selling Guide: Cash-Out Refinance Transactions (B2-1.3-03)
2. Fannie Mae Eligibility Matrix
3. State tax department notice: Otsego County mortgage recording tax
4. CFPB: What are government recording charges for a mortgage?
5. CFPB: Regulation Z, 12 CFR 1026.37
6. Fannie Mae: Closing Costs Calculator
This article is part of Lendmire’s cash-out refinance program — full qualification details, guidelines, and scenarios live on the program page.
Related reading: Does a Cash-Out Refinance Cost More Than a Plain Refinance? · How Much Cash Your Income Supports on a Cash-Out Refinance · Is a $15,000 Cash-Out Refinance Worth the Closing Costs?
Brandon Miller
Founder & CEO, Mortgage Loan Originator, Lendmire LLC
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Important disclosures. Lendmire (NMLS# 2371349) is a licensed mortgage brokerage. Lendmire is not a direct lender, depository institution, or financial advisor. All loan inquiries are subject to lender underwriting; this article does not constitute a commitment to lend. Rates, terms, and program guidelines are subject to change without notice and vary by borrower profile, property type, and state. Information in this article is general in nature and is not financial, legal, or tax advice. Equal Housing Opportunity. NMLS Consumer Access: nmlsconsumeraccess.org.