Who Pays Closing Fees

Closing costs are paid by whichever party has agreed to do so.  The division usually follows local custom, which varies from one area to another.  Almost any arrangement is possible, though, when the sales contract is being negotiated.  In a few places, state law might dictate that the seller must pay any transfer tax.  The seller usually pays recording costs necessary to clear the title, perhaps of an old mortgage being paid off.  The buyer usually pays to record the deed by which he or she takes ownership.  The expenses of placing the buyer's new mortgage may be charged to the buyer, but sometimes the seller has already agreed to pay them. 
Some expenses are "pro-rated" -- divided between the two parties according to what's fair.  Those might include items like the current year's property taxes, unpaid water bills, or interest on a mortgage being assumed.