✏️ Editor’s Note: Realtor Associations, agents, and MLS’ have started implementing changes related to the NAR’s $418 million settlement. While home-sellers will likely save thousands in commission, compliance and litigation risks have significantly increased for sellers throughout the nation. Learn how NAR’s settlement affects home sellers.
When a real estate transaction takes place, it’s not only the buyer who bears the whole expense. Seller also has to pay some costs in a real estate transaction. These costs are called seller closing costs.
What are Closing Costs?
The stage of the house selling process known as closing is when funds and papers are exchanged in order to give the buyer possession of the purchased property. Both the buyer and the seller fulfill their obligations under the contract in a successful closing.
Who Pays Closing Costs?
Closing costs are a multitude of fees that are contributed by both buyers and sellers at the completion of a property deal. Buyers closing fees might range from 2% to 6% of the sales price. The closing expenses for sellers could amount to 8% to 10% of the property’s final sale price.
How much are Closing Costs for Seller?
Closing costs for seller are made up of several expenses that includes taxes, fees and services that differs as per your location. The majority of the closing costs incurred by the seller are subtracted from the sale proceeds. Although purchasers have larger expenses during the closing of a home, the seller frequently bears the cost of both brokers’ commissions.
Property Closing Costs:
- Home Inspection fee
- Home Warranty Fee
- Utility Bills
- Owner’s Title Insurance
- Municipal Lien Search
- Credits Towards Closing Costs
Mortgage Closing Costs:
- Mortgage Payoff
Administrative Fees:
- Attorney fees
- Escrow fee
- Settlement Fee/Escrow Fee
- Real Estate Agent Commission
Government fees and real estate taxes:
- Property taxes
- Documentary Stamp/ Transfer Tax
HOA Fees:
- Homeowner Association (HOA) Fee/ Document Fee
- HOA Estoppel Fee
Seller Closing Costs
Conclusion
The bulk of closing fees in a property deal are usually covered by the buyer, although sellers also have to cover some expenses. As a seller you must be aware about closing fees because they can significantly affect your profits. Remember that closing costs are additional to other expenses related to selling a property, such as home maintenance, staging fees.
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