Costs at Closing: What Does the Seller Pay?
So you put your home on the market. You have cleaned and had professional photos taken. It is now on the market and you have received your very first offer! First off, congratulations! You have made it through the most difficult part of being a seller.
However, did you know that you will have costs to pay at closing?
Wait, you say...."But I am the seller, not the buyer".
That is true, however, there are still costs you will need to consider before agreeing upon a purchase price and taking your home off of the active market.
Below are some costs that you may not have taken into consideration before agreeing to a purchase price and moving forward toward the closing table.
Mortgage Payoff
Let's say that you purchased your home for $100,000. You now owe $90,000. When you sell your home, that $90,000 will be sent to your mortgage loan company to pay off the debt you still have left on your home loan.
Seller Concessions
These are costs you, as the seller, have agreed to pay on the home buyer's behalf. This is usually requested as part of the offer submitted by the buyer. This total is 100% negotiable and can vary from one transaction to the next.
Agent Commission
When you are sick and need to go to the doctor, you would only want to go to a professional. The same goes for selling Real Estate. Professional Real Estate agents know what they are doing and know how to properly price your home, market it, and sell it quickly. They will also know what advice to give to walk you through the purchase process. and make sure that you are making decisions that are the best for you and your situation. This service will, however, come at a cost. It is a minimal cost in association to your final total and every agent's rates differ. Be sure to get all of the details up front so you know the plan. This cost will also come off of your net profit at closing.
Home Repairs
During the purchase process, the buyer has the option to have a licensed professional perform a home inspection. Once an inspection is complete, the licensed inspector will provide them with an inspection report. At this time, the buyer has the option to request repairs from you, the seller. The cost of the repairs agreed upon will also be a direct cost to you.
Home Warranty
Also, during the offer process, the buyer can request for you to provide a Home Warranty. If this is something you agree to, this will also be at your expense.
Title Fees
During the closing process, a closing attorney at a title company will be hired to collect and draft up all paperwork. They will also be responsible for preparing the deed and searching old titles, as well as creating a new title. These fees can be partially charged to you as the seller.
Prorated Taxes
In Indiana, property taxes are paid in arrears. So that means you pay the property taxes for the previous calendar year. This can be confusing when selling a house. The purpose of prorating the taxes is so that both the buyer and the seller are fairly paying for their portion of time they owned the property.
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