Selling a house is not about counting cash. There are lots of ups and downs in the journey. Many sellers overestimate the amount of money they will get from the house. You are often looking at the listing price but forgetting about the tiny expenses that you will encounter along the way. You need to make accurate calculations to avoid disappointment and a loss of money. Most people think of realtor commissions. While your real estate agent will charge you a portion of the sales price, that’s not the only cost.
Closing costs for sellers can vary depending on factors such as location, the specific terms of the sale, and any negotiated agreements between the buyer and seller. In this article, we will cover a comprehensive list of potential hidden closing costs for sellers:
Mortgage Balance
Lawton home sellers need to know about prepayment penalties on the mortgage or equity loan payoffs in the closing costs. It’s possible to lose money on the sale after paying exorbitant penalty fees. However, in the best-case scenario, your final sales price pays off the balances on any loans and leaves you with a profit.
Commissions and Fees
This is typically the most significant cost for sellers. The standard commission is around 5–6% of the sale price, split between the seller’s agent and the buyer’s agent. However, this percentage can vary based on the agreement. Most people think that you can avoid commissions by choosing FSBO, which is not completely true. You can avoid the listing fees, but you still have to pay the buyer’s agent.
Transfer Expenses
Some states or local governments impose transfer taxes on real estate transactions. The seller may be responsible for paying these taxes, although it can sometimes be negotiated for the buyer to cover them.
Taxes and Document Fees
Sellers are typically responsible for paying property taxes and homeowner association (HOA) fees up to the closing date. These are often prorated based on the portion of the year the seller owned the property.
Title Insurance
Sellers often pay for the buyer’s title insurance policy as a customary expense. This protects the buyer and lender from any issues with the title, such as liens or ownership disputes.
Home Warranty
Sellers may choose to offer a home warranty to the buyer, which covers certain repairs or replacements for appliances and systems within the home. While this isn’t always required, it can be a selling point for buyers and is often paid for by the seller.
Legal Fees
Often, Lawton home sellers hire attorneys to represent their interest at closing and need to know that these attorney fees may be part of the closing costs.
Other Expenses
These costs, while not taken from the proceeds directly, should still be considered. In addition, you may need to consider any effect the sale may have on your income taxes and any capital gains. These include the title company, which may charge fees, depending upon the services they provide. If you sweetened the deal by offering to pay the buyers closing costs, these would also come out of the final proceeds. Finally, sellers must have also paid any other service providers involved in the transaction at this time.
- Closing Attorney or Escrow Fees: In some regions, a closing attorney or escrow company handles the closing process. Sellers may be responsible for paying for these services.
- Home Repairs or Upgrades: Depending on the terms of the sale agreement, sellers may be required to make certain repairs or upgrades to the home before closing. These costs can vary widely depending on the condition of the property.
- Seller Concessions: In some cases, sellers may agree to cover some of the buyer’s closing costs or offer other concessions to facilitate the sale. These can include things like covering a portion of the buyer’s loan origination fees or prepaid expenses.
- Outstanding Liens or Judgments: Sellers are responsible for settling any outstanding liens or judgments against the property before closing. This can include things like unpaid property taxes, mechanic’s liens, or judgments from creditors.
- Home Inspection Repairs: After a home inspection, the buyer may request repairs to be made before closing. Sellers are typically responsible for covering the costs of these repairs, unless otherwise negotiated.
- Home Staging Fees: Staging a home is mandatory for maximum exposure. Usually, the fee is paid in two ways. Either it’s charged as a portion of the sales price, like 1%, or a fixed amount, depending on the square footage.
- Miscellaneous Fees: There can be various other fees associated with the closing process, such as document preparation fees, courier fees, or recording fees. While these are typically smaller expenses, they can add up.
Work with Us
Selling to DHS Realty Group lets you skip some expenses. You can avoid paying realtor commissions. We buy houses directly from Lawton homeowners. Would you like to sell your house?
A direct sale allows you to reduce selling costs in multiple ways. You don’t have to repair the house. You don’t have to stage the property or pay for expensive photography services. You can eliminate all those expenses.
At DHS Realty Group, we cover your closing costs. You can reach out today for a fair cash offer. We will give you a cash offer, and that’s the amount you can keep in your account. You will not have to pay listing fees, commissions, or closing costs. Contact us today, and we will help you out.