Closing costs are expenses incurred by both buyers and sellers during the course of a real estate transaction. You should be aware of the numerous closing fees you will be accountable for when selling your house as a seller. Here’s a breakdown of the standard closing fees for sellers:
Real Estate Agent Commission:
The real estate agent commission is the most expensive expense for most sellers. The commission is normally 5-6% of the home’s final sale price, and it is split between the buyer’s and seller’s agents.
As the seller, you will be obligated to pay property taxes up to the date of the sale. The amount you owe will be determined by the local tax rate and the length of time you owned the property during the tax year.
Title insurance is normally purchased by the buyer, but as the seller, you may be required to pay a portion of it. Title insurance protects both the buyer and the lender from any title flaws or disputes that may emerge following the sale.
You will be responsible for the attorney’s fees if you choose to engage one to represent you during the transaction. The attorney can assist in reviewing contracts, negotiating terms, and ensuring that the sale is in accordance with state and municipal regulations.
Some sellers opt to acquire a home warranty for the buyer, which covers certain repairs and replacements for a set length of time following the sale. The price of a house warranty varies according to the supplier and the level of coverage.
When a sale is completed, the title company or attorney will administer the escrow procedure, which includes holding and delivering payments. The title company or attorney will also be in charge of notifying the local government of the sale. Often, the cost of these services is divided between the buyer and the seller.
HOA or condo fees must be prorated if you live in a community with HOA or condo fees.
Selling a house entails a number of closing charges that are covered by the seller. These prices may differ depending on the location and specifics of the sale. It is critical to engage with a knowledgeable real estate agent who can assist you in understanding and planning for these expenditures. You may avoid surprises and ensure a smooth and successful transaction by doing so.