Think about closing costs when you dreams of owning a home one day. Everyday this dream gets realized for many. The date of property sale is a big date for both the buyer and the seller. Known as closing date, it is on this day that the seller transfers the property to the buyer. Both the buyer and the seller goes through mixed emotions during the closing for different reasons altogether, and that brings forth another word that’s everyone’s mind during the sale – closing costs.
So, who pays the closing costs?
Both the seller and the buyer pay closing costs during the sale. The sellers pay the commission which will be based on the percentage of the total sales price, while the buyers have more in-line item expenses like Appraisal fees, Tax servicing fees, Flood certification fee, Credit report fees, Bank processing fees, Title insurance, Notary fees and many more.
There are other fees which are known as typical closing costs. They come in the following categories:
- Lender origination fees
- Life of Loan Flood Monitoring
- Title Search Fees
- Pest Inspection Fees
- Title-Closing/Escrow Fee
- Recording Mortgage
- Tax Service Fee
- Title-Lenders Title Insurance
- Credit Report Fee
- Attorney’s Fees
- Title-Owners Title Insurance
- State Tax/Stamps Deed
- Appraisal Fee
- County Tax/Stamps Deed
- Prepaid Interest
- Homeowners Insurance
If you are buying a home that’s priced at $195,000, then all the fees would be estimated at $7,329.
Realtor commissions
Selling your home through a Realtor and paying the Realtor his/her well-served commission is the next in the list. The national average for Realtor fees is at 6% while it could average between 4-8% depending on the location. It is the seller who normally pays the commission, while the total commission will be divided between the buyer’s and seller’s agents and brokers.
If you sit down to calculate the closing costs of a home, you will see that it easily crosses the 10% or more of the sales price of the property, on an average.
That’s not all. You will also have to consider the additional costs associated with getting a property ready for sale. If your property is in good condition with just minor repairs and upgrade requirements, then you can quote a good price. If not, you will have trouble getting the asking price.
These may sounds a bit overwhelming for you, then you can always choose the easier way out. Getting a cash offer from a property investor for your property would probably be a good idea because you don’t have to worry about closing costs as well. Get in touch with us. We provide all-cash offers minus the fees.
