You’ve likely heard about closing costs, but do you know everything that they include and how much they truly add up to? This article will go through all of the standard closing costs that you’ll find yourself paying when you sell your house. We buy houses in VanWest Homebuyers and pay for all of your standard closing costs! Don’t want to pay for closing costs? Fill out the form at the bottom of this page or call (303) 625-9837.
So… How Much Are Closing Costs Exactly?
Closing costs refer to all of the fees that must be paid at the closing table (when you sell your house). Depending on where you live, the fees and costs can vary. But generally, closing costs include, but are not limited to:
- Notary fees
- Transfer Costs
- Transfer Taxes
- Appraisal Costs
- Inspection Fees
- Origination Fees
- Recordings Fees
- Title Insurance
- Underwriting Fees
- Bank Fees
- Courier Fees
- Wire Transfer Fees
- Liens against the home will need to be paid to clear the title
- Credit Report Fees
- Administrative Fees
- Attorney Fees, If Applicable
- The balance of your mortgage or loans against the home
- Possibly repairs or pest control if this has previously been agreed upon
- COMMISSIONS!
Who Pays Closing Costs?
While the buyer will usually pick up a number of theses, it is important to note that the seller typically pays 100% of the commission when selling with an agent (VanWest Homebuyers) doesn’t charge any fees or commissions). This will be about 6%+ of the final sale price. Other than paying off your mortgage balance, this is by far the biggest cost when it comes to costs at the closing table. Negotiating the other costs during the sale process is becoming increasingly popular. In an effort to lure in more buyers, sellers are more frequently picking up the tab when it comes to the closing costs.
As a seller, you will also need to pay your share of the year’s property tax, up until the day of closing. Any HOA fees or other community costs should be prorated and paid at this time as well.
What Are Seller Subsidies?
It is the percentage the seller agrees to pay towards the closing costs and is an amount negotiated between the buyer and seller… For example, you can offer to put $3,000 towards closing costs to help relieve some of the costs for your buyer. Overall, paying these subsidies are often a small price to pay to bring buyers to the table!
Can You Avoid These Costs?
Yes! You can avoid closing costs by working with a cash buyer (like us) who will pick up all of the standard costs associated with the closing! A cash buyer will not charge you a commission mainly because they are not an agent. Many times, cash buyers will offer to pick up all costs, which will save you money and hassle at the closing table.
Are Repairs Included?
This is another one that is negotiated between the buyer and the seller. If the home is in need of some obvious repairs, the seller will often need to pay for and fix these before putting their home on the market. However, if an inspection shows additional repairs are needed, a buyer may make his offer contingent on repairs being made. A buyer and seller can work this out before going to closing. When selling with a cash buyer, you don’t have to make any repairs!