Delaware 4% Realty Transfer Tax: 2% Buyer Split and the $3,000 First-Time Buyer Credit — Hen & Harbor
Updated October 2026
For a $400,000 Delaware purchase, a customary 2.0% buyer transfer-tax share equals $8,000 before any qualifying first-time buyer credit. That expense belongs in your initial purchase budget, not on a list of surprises to address after mortgage approval.
Understand the 4.0% total
Delaware’s realty transfer tax combines a 2.5% state component and a 1.5% county or municipal component. The customary allocation divides the 4.0% total equally: 2.0% to the buyer and 2.0% to the seller. Your contract and closing documents establish how the transaction’s costs are actually allocated.
Under that equal split, the buyer’s share consists of 1.25% state tax plus 0.75% local tax. The first-time buyer benefit reduces the qualifying buyer’s state portion; it does not eliminate the local portion or automatically change the seller’s responsibility.
The Delaware Division of Revenue provides official transfer-tax information and forms. Give your closing attorney the information needed to determine eligibility early in the transaction.
Calculate the first-time buyer savings
The Delaware First-Time Homebuyer Transfer Tax Credit reduces the buyer’s state share by 0.75% on up to $400,000 of purchase price. The maximum direct closing savings is $3,000.
| Purchase price | Buyer share before credit | Qualifying credit | Buyer share after credit |
|---|---|---|---|
| $300,000 | $6,000 | $2,250 | $3,750 |
| $400,000 | $8,000 | $3,000 | $5,000 |
| $500,000 | $10,000 | $3,000 | $7,000 |
These examples assume the customary equal split and full eligibility for the credit. A price above $400,000 does not increase the maximum savings. Ask how ownership history and multiple purchasers affect the required certification rather than assuming a mortgage program’s first-time buyer definition controls the tax benefit.
Keep tax savings separate from other costs
The credit lowers transfer tax; it does not pay attorney fees, title charges, homeowners insurance, or the lender’s escrow deposit. Delaware requires a licensed attorney for the legal closing work, making early document coordination especially useful.
Build a complete estimate with the closing cost estimator and review the attorney closing timeline. Compare the final figures with the Closing Disclosure using the Consumer Financial Protection Bureau resources. Hen & Harbor treats the credit as a specific closing-cost reduction, not a substitute for a complete cash-to-close calculation.
Compare Current Mortgage Rates
Compare current APRs, points, fees, and estimated monthly payments from participating lenders below.
Loan Program Comparison: 2026 Benchmarks
Delaware 4% Realty Transfer Tax: 2% Buyer Split and the $3,000 First Time Buyer Credit — Compare Delaware state housing finance agency (HFA) and municipal down payment assistance options; verify household income limits, purchase-price caps, homebuyer education rules, and repayment or forgiveness terms.
Historical 2025 one-unit comparison: conforming $832,750; FHA floor $541,287. County and unit-count limits can differ.
| Loan program | Down payment / equity | 2026 one-unit baseline | Costs and page-specific comparison |
|---|---|---|---|
| Conventional | 3%–5% subject to eligibility | $832,750 | PMI generally below 20% down |
| FHA | 3.5% at 580+; 10% at 500–579 | $541,287 floor | 1.75% upfront MIP; 0.55% annual for >95% LTV, base loan ≤$726,200, term >15 years |
| VA | 0% for eligible borrowers | No VA limit with full entitlement | No monthly PMI; funding fee unless exempt |
| USDA | 0% for eligible borrowers | Income, address and repayment eligibility | Guarantee and annual fees; confirm current schedule |
| Jumbo | Lender-specific cash and reserves | Above applicable conforming limit | Lender-specific pricing and insurance |
| Home Equity / Refinance | Equity and underwriting dependent | Property and lender dependent | Compare closing costs, term and break-even |
Sources: FHFA limits; HUD FHA limits.
Editorial Methodology & Primary Sources
Verification date: Not recorded; check the primary source and lender timestamp before relying on an estimate.
Rate comparisons use participating lender feeds, not a whole-market survey or guaranteed offers. Freddie Mac PMMS is a market benchmark, not a personalized quote. Calculator models rely on published regulatory formulas and disclosed assumptions rather than fabricated first-person loan testing.
Monthly principal and interest use the amortization formula P × r / (1 − (1 + r)−n), where r is the monthly note rate and n is the number of payments; at zero interest use P / n. PITI adds monthly property taxes and homeowners insurance; PMI is separate. APR includes applicable finance charges under Regulation Z and is not the note rate used for payments. Compare lender Loan Estimates for actual APR and fees.
- Consumer Financial Protection Bureau (CFPB) — Loan Estimates, APR and borrower disclosures; Regulation Z.
- U.S. Department of Housing and Urban Development (HUD / FHA) — FHA program guidance.
- U.S. Department of Veterans Affairs (VA) — VA loan eligibility and benefits.
- Freddie Mac Primary Mortgage Market Survey (PMMS) — published rate benchmarks.
- U.S. Census state tax collections — state property tax benchmarks; confirm parcel-specific assessments and exemptions with the state revenue department and local assessor.
- Delaware State Housing Authority — state housing finance and property tax authority.
- Delaware Division of Revenue — state housing finance and property tax authority.
The payment snapshot uses illustrative annual taxes of 1% of home price, $1,200 insurance and 0.5% PMI below 20% down, not verified local quotes. Other calculators disclose their inputs and assumptions. Published guidance and lender feeds may change independently; confirm current program rules, taxes and offers before a decision.