You’re finally moving on up to that house with the corner lot. You and your family are excited about the move. But there’s still one thing you have to do first: sell the current house.
Your current house has been on the market for a while; you’ve had to put in a bit of extra work on it, a few deals have fallen through the cracks but you have finally found a buyer.
You’ve been through enough with this house so your first thought is obviously, “I want to sell my house fast!”
But there are several steps that you must take for the deal to go through and as a first-time seller, you are unsure of the closing costs when selling a house.
Here is a detailed look into what closing costs are and what you can expect to pay.
What Are Closing Costs Anyway?
After the bulk of the deal is done, there is the matter of closing costs. Closing costs are the combination of taxes, fees, prepayments, and services that can vary based upon your state.
Local regulations can impact the amount individuals pay for their closing costs. Things like local taxes and lending costs can increase or decrease the amount you pay.
Burdens of the Seller
Both the buyers and the sellers have to pay closing costs for a house. As of 2019, buyers can expect to pay anywhere from 2 to 5 percent of the home price in the closing costs.
As the seller, you can expect to pay anywhere from 8 to 10 percent. So with a median American home cost at $315,000, as the seller, you can expect to pay a pretty hefty sum.
Most of the percentage comes from the listing fees and the buyer’s agent commissions. But don’t worry, this is usually subtracted from the sale proceeds so it is rare for you to have to pay out of pocket.
Things Included in Seller Fees
Aside from the major expenses there a few other things that sellers need to pay for when covering their end of the closing costs
Also known as the title fee, these are paid to cover the transfer of the title to the house from the buyer to the seller
These are usually around 4-6 percent but can be negotiated. Make sure you do your due diligence to help reduce this amount.
Also called the closing fee, this is paid to the escrow company or attorney for closing the transaction. This is often conducted by an independent party.
Prorated property taxes, HOA fees, Title Insurance, and Attorney’s fees are some of the other fees that are paid at closing. It seems like a lot that the seller has to do, but most of it is covered by proceeds.
Closing Costs When Selling a House
Closing Costs when selling a house may seem overwhelming but do not let all the fees and responsibilities deter you from selling your home. Most of it is handled by quality realtors and attorneys. That’s where most of the money goes to for their services.
You have the buyer, you have the new house, now just close the deal. You can do it.