You’ve Done It Now!
You finally decided to sell your home. You have lived in it for a number of years and it has been filled with any memories. So you call the Realtor, decided on a listing price and if all things work out well, you shortly have an agreement with a buyer.
The next question on the minds of all home sellers is…..
HOW MUCH MONEY WILL I GET AT CLOSING???!!
The short answer…….It Depends Most people are aware that home buyers have to pay closing costs. Fewer are aware that the seller also must pay closing cost. I will illustrate below a number of typical seller costs. This list is for illustration purposes only. Actual costs or types of fees differ from state to state. ************************************************************************************ Interest on Loans Paid Off – Interest on most home loans is paid in arrears. What that means is you pay interest at the beginning of the month for the month that just passed. If the closing is held on the 21st of the month, the home seller owes interest for the 1st 21 days.
Real Estate Commission - This is the amount that you have agreed to pay a Realtor to sell your home. This can range from 5-7% of the selling price. This amount may be less if you have decided to sell your home yourself or decided upon a discount broker.
Title Search & Insurance – When a property is sold, the buyers want to be assured that the sellers have legal title to the property and have the right to sell it. The buyers also want to ensure that there are no liens against the property. A title search ensures that there is a clean title and an insurance policy protects the buyer if a discrepancy arises at a later date. In some states, the seller must pay for a title search and insurance policy.
Real Estate Transfer Fee – This is a fee that is assessed when real estate transfers ownership. This may not be applicable in all states. However, I did write a previous post about the NJ Real Estate Transfer Fee
Home Warranty – Home sellers may decide to entice buyers by offering a 1 year home warranty. The cost for this service is $350 - $500
Pre-payment Penalty – Some loans have penalty if they are paid off early. Check with your mortgage lender to determine if your mortgage has a pre-payment penalty.
Recording Release of Mortgage – when paying off Mortgages or Home Equity Line of Credit, you may have to file a lien release. The cost of recording each lien release may range from $20-$150.
Settlement or Closing Fee – This is the cost that the title company charges for the settlement clerk and the closing facility. It may be split evenly between the buyer and the seller
Utilities – The home seller will be required to pay the utilities up to the day of closing. If there are delinquent utility bills, the seller may have to pay those bills from the money he/she receives at the time the house is sold. Typically, the utility company will take a final reading on the day of closing and forward a final bill to the home seller.
Repairs- Instead of making certain repairs, the home seller may agree to pay the buyer to have the repairs completed. This is an additional closing cost to the seller.
Misc. Charges – other costs which you may find on the sellers bill include, notary charges, document preparation, courier, postage or overnight payoff (wire transfer) fee.
I hope this has helped my home sellers. I always provide estimated proceeds (how much money you will get) when I list your home for sale. I like my clients to be well informed. If you are thinking about selling your South Jersey home…… Call ME NOW! Let me share with you my 21 point marketing plan. Don’t forget to ask me how I sold a home in 21 days in a neighborhood where no home was sold in the previous 6 months.
Have a Great Day
Make This YOUR Best Year Ever
Leander McClain, Burlington /Camden County, NJ Realtor & Real Estate Consultant, Keller Williams Realty, 1814 Route 70 E Cherry Hill, NJ 08003 856-685-1677 Direct
Search NJ & PA Home Listings @ www.NJSouthRealEstate.com
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