•1. Payoff any current liens, ie: 1st and 2nd mortgages. Remember that the payoff will be higher than the current balance shown on your monthly statement. This is due to the fact that your monthly interest in collected one month in arrears. That means the January payment pays December interest. Additionally, your lender may charge you one month's additional interest as a pre-payment penalty. Some lenders charge pre-pay penalties as high as 6%. Look at your promissory note to determine if a pre-payment penalty will apply. To be on the safe side, when you put your home on the market, you should send a letter to your lender informing them of your intent to pre-pay your note and request a payoff. IF you will be charged a pre-payment penalty, it will be reflected on your payoff statement.
•2. Deed Transfer Tax - In Kentucky, this is paid by the seller and is $1 per $1000 of the sales price. For example transfer tax on a $150,000 sale would be $150.00.
•3. Deed preparation - Customarily paid by the seller - usually costs around $75.00
•4. Real Estate Marketing fee - determined by the contract you have with your agent - typically X % of the sales price, however, some agents will charge a flat fee per transaction.
•5. Property Tax - pro-rated to the date of closing. In KY it depends on the billing cycle of the County the property is located in. (In some counties, sellers pre-pay for the first six months of the year.) Taxes will be pro-rated based on the current assessment, not on the sales price.
These are the normal and customary charges to a seller. Sometimes, buyers will ask the seller to pay pre-paids and other closing costs associated with their loan. This is considered in the offering price the buyer makes and seller accepts. In the case of a VA loan, a termite inspection is required and must be paid by the seller. The cost in Owensboro is from $65.00 - $75.00
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