Common Closing Costs for Home Sellers
After accepting an offer on a home, it’s easy to get caught up in the excitement of your incoming profit. However, don’t forget about your closing costs before celebrations commence, as these expenses will be deducted from your sale before the deal is closed.
By working with the experts at Mark Spain Real Estate, you can ensure you take all the proper steps toward a successful real estate closing. With decades of valuable industry experience, our team offers exclusive market insight to help prepare you for the financial complexities of the closing process. For home sellers looking for more insight on closing costs, this blog is for you. Read below to learn about the eight most common closing costs for home sellers.
Common Closing Costs for Home Sellers
Sellers are responsible for paying for title insurance when closing on a home. If the buyer uses a mortgage to buy the home, their lender will require title insurance to protect them from ownership disputes. It’s common for sellers to cover this cost, while buyers cover the lender’s title insurance to protect their interest in the property. While title insurance costs can vary depending on your state and the title company you work with, most payments range from $500 to $3500.
Property Transfer Taxes
When your buyer becomes the official owner of your home, your state or local government will tax you for the property transfer. These taxes will vary depending on the state you live in. However, they are typically measured by pulling a designated number of dollars for every $100,000 of the property’s value up to a specific portion of the property’s sale price.
Escrow protects the seller and the buyer while the home sale is underway. An escrow account is controlled by a third party and is created to hold all purchase funds until the deal is finalized. Because escrow keeps all parties accountable, the seller and buyer typically split escrow fees half and half.
Hiring a real estate attorney when selling a home is generally recommended. While they aren’t required in all states, an experienced real estate attorney protects your interests as a seller. Fees will vary depending on your state and local market, but you can expect to pay around $150 to $500 an hour.
Local governments typically charge a recording fee and taxes to legally document a real estate transaction. Recording fees will vary by location, but most are charged at a flat rate of around $125.
Homeowners Association Fees
Depending on your community, you may be subject to a homeowners association fee up until your closing date. Sometimes, an HOA may also charge an additional fee to transfer your home’s ownership to your buyer.
If you’re selling your home in a buyer’s market with ample listings, you might offer some concessions to close a deal. For example, agreeing to pay for necessary repairs after the home inspection is a standard seller concession.
The Bottom Line
Familiarizing yourself with closing costs is one of the best ways to stay stress free while selling a home. Though you’ll receive a large profit once all is said and done, it’s important to stay mindful of your finances during and after the closing process to keep financial peace of mind.
Hiring an experienced real estate agent to sell your home is a helpful way to learn more about the closing process. Not only will your agent alleviate common selling stressors like staging a home or setting a listing price, but they will also offer your valuable advice about closing on a home and its associated costs.
Sell Your Home with Mark Spain Real Estate
Are you selling a home? The industry professionals at Mark Spain Real Estate are here to tell you what to expect during the closing process. Delivering unparalleled customer satisfaction, our team of expert listing consultants will help you navigate your real estate closing hassle-free! Check out our Guaranteed Offer Program for the potential to receive a competitive cash offer on your home in only 21 days. Contact our agents today!