As a seller, it is important to know the closing costs associated with the sale of your property. These costs can vary depending on the type of property and location, but typically include things like agent commissions, title insurance, and transfer taxes.
In most cases, closing costs are paid by the buyer, but as a seller, you may be responsible for some of these expenses. Therefore, it is important to have an estimate of these costs before putting your property up for sale. This will help you determine the amount you can realistically expect to receive from the sale.
Additionally, it is important to work with an experienced real estate agent who can guide you through the process and ensure that all necessary expenses are taken into account.
Here are some closing costs that are common for the seller:
Mortgage balance: The balance of the existing loan, balance of the second mortgage, and lines of credit on the home.
Loan Fee: Administrative fee charged by the lender to repay the loan.
Debt Release: Money owed to contractors and/or for court judgments or property taxes. These amounts must be paid before closing.
Penalty for early payment: Some loans have a penalty for early payment of the debt.
Recording Fees: Fees payable to document that debts have been paid in full.
Commissions: The fees paid to the real estate brokers involved in the transaction. Generally 6% of the sales price and paid in full by the seller.
Notary Fees: The fees charged by the notary to verify the identity of the signers of the document.
Escrow Costs: Escrow agents receive money from the lender, pay all fees, collect deposits, and distribute the proceeds to the lender/seller.
Title search fees: Proof that the seller has the legal right to sell the home. Title companies search public records and produce a commitment of insurance that certifies that the seller owns the home and lists the details of any liens or other claims affecting the title to the home.
Seller Concessions: Amount the seller agrees to give in order to help the buyer pay his or her closing costs.
Repairs: Work that the seller must complete (if applicable) before the sale, either as a result of the buyer’s negotiation or as a condition of the lender.
Home Warranty: Protection plan for the buyer’s first year in the home.
