What a Pennsylvania Overlap Actually Costs

Key takeaways

Start by counting transfers, because the realty transfer tax attaches to each one and a move-up usually produces two. (PA Dept of Revenue, read 2026-09-24.)
State rate is 1 percent of the value of real estate transferred. The local rate is collected alongside it and varies by jurisdiction. (PA Dept of Revenue, read 2026-09-24.)
Your closing agent or the county Recorder of Deeds will supply the local figure. We do not publish unverified local rates.
Then net proceeds: sale price, less transfer tax on that deed, less payoff, less any second, less ordinary costs of sale. (PA Dept of Revenue, read 2026-09-24.)
If you keep the home instead: one taxable transfer, plus gross rent times 75% less its PITIA as an offset. (Fannie B3-3.8-05, 09/02/2026.)
Reserves are six months of the vacated home's PITIA under 12 months of property management experience. (Fannie Mae B3-3.8-05, dated 09/02/2026.)
Every figure here is an estimate. Your closing agent settles the tax; your underwriter settles the ratio. (Fannie Mae B3-3.8-05, dated 09/02/2026.)

Program and regulatory figures verified September 25, 2026. Details change; confirm your scenario with us.

By Mike Certo, Cornerstone First Mortgage · NMLS #260555 · Updated September 25, 2026

Pennsylvania's arithmetic has one step most states do not: count the deeds first, because each one is taxed.

Step one: count the transfers

Structure	Deeds recorded	Taxable transfers
Carry both, recast after the sale	Purchase, then sale	Two
Borrow against the departing home's equity	Purchase, then sale	Two
Keep it and rent it	Purchase only	One

Step two: get your local rate

The state portion is 1 percent of the value of real estate transferred. The Department of Revenue says an additional local realty transfer tax is often collected alongside it by the county Recorder of Deeds, and that locals may share theirs among school districts and municipalities.

It does not publish local rates and neither do we, because we have not verified them and they vary by municipality and school district. One call to the Recorder of Deeds or your closing agent gets you the exact figure for the parcel.

Apply that combined rate to the value of each property being transferred.

Step three: net proceeds on the departing home

Expected sale price.
Less transfer tax on that deed at the combined rate.
Less the existing mortgage payoff.
Less any second mortgage or equity line taken to fund the down payment.
Less ordinary costs of sale.

What remains retires a bridge or funds a recast.

Step four: if you keep the home

One taxable transfer instead of two. Then, under Fannie Mae B3-3.8-05, monthly gross market rent times 75%, less the departing PITIA. Positive offsets that property's payment and nothing more. Negative is added to your ratio. Six months of reserves on that PITIA if you have under 12 months of property management experience.

What you do not need to calculate

The loan limit. 66 of Pennsylvania's 67 counties sit at $832,750 and typical values run far below it, with Philadelphia leaving roughly $443,226. Only Pike County differs, at $1,209,750.

See the transfer tax page, the loan limits page and the structures page.

Frequently asked questions

How do I estimate Pennsylvania realty transfer tax?

Apply the combined state and local rate to the value of each property being transferred. The state portion is 1 percent; the local portion varies by municipality and school district and is available from your closing agent or the county Recorder of Deeds.

Why does this site not publish local Pennsylvania transfer tax rates?

Because they are set locally, vary by municipality and school district, and are not published on the Department of Revenue's realty transfer tax page. We have not verified them, and a stale figure would be worse than none on a tax that scales with the price of a house.

What reserves should I plan for on a Pennsylvania move-up?

For a rental conversion with less than 12 months of property management experience, six months of the vacated property's PITIA, plus any reserves required for multiple financed properties.

Mike Certo · NMLS #260555 · Cornerstone First Mortgage NMLS #173855 · Equal Housing Lender. Educational content about financing, not a loan commitment and not legal, tax, or real estate advice. Pennsylvania realty transfer tax is collected by county Recorders of Deeds and local rates vary by municipality and school district; your closing agent, your CPA or a Pennsylvania attorney, and your real estate agent each handle their own part. Loans are subject to borrower and property qualification.