Nothing in life is truly free. Even getting up for a glass of water costs you time and energy. So it stands to reason that the highly involved process of selling or buying a home would come with a cost. The aid of pertinent professionals, services, and regulatory compliance is sure to cut into your profits to some degree. So what are the closing costs for the seller?
Of course, getting your home ready for market and completing the sale will come with several other expenses. Some of those expenses are unique to South Florida, and some are universal. The state of Florida has attached certain fees to transferring a deed, which we will discuss here.
What are the Closing Costs for the Seller?
Different customary closing costs depend on where in South Florida you live. For example, in Broward and Dade counties, it is typical for buyers to select the title company and pay for both title policies. Other customary closing costs include;
- Documentary Stamps: This is a fee that is collected on the final sale price of the home.
- Title Search: This is the fee incurred to review the history of liens and ownership of the property.
- Courier Fees: Those with a mortgage will be charged a fee for the service of sending the final payment to the lender.
- Estoppel Fees: Sellers who own a condominium or owe dues to a homeowners association will be charged this fee for the service of determining the total payoff.
- Property Taxes: Property taxes are pro-rated to the final day of closing.
- Listing Commission: This is the fee for having a home listed for sale by a real estate company.
- Pest Inspections: If the buyer has qualified for a VA mortgage, the seller may be required to pay for a pest inspection.
- Closing Fees: This can go to either the buyer or the seller but usually goes to the buyer.
- Title Insurance: If the buyer is receiving a mortgage, they will pay a fee for the lender’s policy. The title policy must also be paid for, but this is negotiable.
Why Do I Need to Know About Closing Costs?
Sometimes people feel they don’t need to know about all these fees when exchanging large amounts of money. While this is understandable, the cost of these fees might break your budget if you’re working within a tight margin. This is especially true if you’re selling off a home for which you have a mortgage.
You’ll have noticed the buyer pays some fees, the seller pays some, and some are negotiable. When possible, you’ll want to find out which you will have to pay. This may not always be possible with negotiable fees. But knowing your total end costs is always a good thing when possible.
How to Calculate Your Closing Costs
Closing costs for the seller can be obtained from a real estate agent. They will have access to a closing costs calculator. You can find closing cost calculators online, but you may not know which fees will be paid by whom. Your Realtor will have better access to that information. For a start, for can begin by following these steps;
- Decide how much you expect to spend on your new home.
- Decide how much down payment you are willing to pay.
- Include the interest rate and account for mortgage fees
- Add up the following:
- Appraisal fee
- Home inspection fee
- Application fee
- Attorney fees
- Prepaid interest
- Loan origination fee
- Mortgage broker fee
- Property tax
- Homeowners insurance premium
- Title insurance
- Title search fee
This list of costs will not be complete for every location, but it will give you a good ballpark figure to start from.
When to Calculate Your Closing Costs
When you work with a reputable Realtor, you can be sure that your closing costs will be made clear to you. But if you want to do it yourself, the best time to do so is:
- Before shopping for your new home: Any time you plan to take on new expenses, set up a budget as soon as possible. This is especially true when investing in a home.
- When shopping around for a mortgage broker: Shopping for a good mortgage deal is a big job. Calculating your closing fees is an important part of making the right decision.
- When shopping for a new home: If you have started shopping or have listed your home before learning about closing costs, it’s not too late to crunch the numbers.
Work With A Brokerage You Can Trust
Our experienced agents will be glad to help you put your finger on the final costs. In fact, it’s a big part of our general customer service support policy!
Here at Bello Real Estate in Fort Lauderdale, our team of experienced real estate agents is dedicated to bringing you an unparalleled quality of service in the industry. We do that through our transparent process and our commitment to helping you understand the home buying and selling process. If you’re tired of real estate agents who leave you in the dark, it might be time to give Bello Real Estate a call.