Carlsbad Sellers’ Closing Costs in a Real Estate Transaction
Homeowners who are planning to sell are naturally interested in what they can sell their homes for. It’s probably the number 1 question sellers want answered.
Hopefully you have hired a great Realtor to help you determine the value and get your home prepared for the market, then listed and sold.
But before you start counting those dollars, you do not want to forget about the closing costs that will impact your net proceeds. Remember when you bought the home and had to pay those closing costs?
While they differ, there are closing costs for sellers, too.
We will discuss these fees if we work together, but any respectable listing agent should provide you with some projected costs when you are getting started so you have an idea of the net proceeds. Keep in mind real estate transaction fees can vary depending on a whole host of factors, including what the contract says buyers and sellers will pay.
There are 2 substantial fees for most sellers – the commission (you ARE using a licensed professional, aren’t you, so you can maximize your sales price?) and the mortgage payoff; no doubt the payoff is the biggest expense so let’s cover that first.
Unless you are fortunate enough to not have a mortgage, the bulk of the money impacting what goes into your pocket after closing is the loan payoff. Your latest mortgage statement should provide the current loan balance.
Remember, however, the final payoff amount (e.g., principal, interest, other fees charged by the lender such as reconveyance and recording fees) will depend on the actual closing date.
If you have a second loan, say a home equity loan or line of credit, that must get paid off as well.
The other substantial fee is the commission, which is negotiable. You will agree on that fee with the listing agent and brokerage you hire, and it will be spelled out in your listing agreement.
Here are some other fees you may have, depending on the property and what’s been negotiated in your contract with the buyer. Keep in mind this is from my perspective here in Carlsbad CA – speak with your agent early on to obtain an estimate of what real estate fees to expect where you live. For example, you might not use an escrow company where you are located, and some states use attorneys.
Property taxes that are due and haven’t been paid (or a credit from the buyer for property taxes already paid beyond the closing date)
Escrow fee (seller portion)
Owner’s Title Insurance Policy (typically paid by seller per the contract)
Transfer Tax for San Diego County ($1.10 per $1000 of purchase price)
Natural Hazard Disclosure Report Fee
Home Warranty (buyers commonly request seller pay for 1 year)
HOA Document Preparation Fee (if there is an HOA – often paid in advance when escrow opens)
HOA Transfer Fee (if applicable)
There may be other fees as well, including Courier Fees, Notary Fees (for the deed) and Document Recording fees (e.g., payoff of the loan).
While you should have an estimate upfront, the escrow company will provide a summary of the fees, any credits, and your net proceeds shortly before closing.
For more information on key things you should know when selling your home, check out my video series on my YouTube Channel, Home Selling Tips and Advice (21 short 1 to 2 minute video tips).
If I can assist you in any way with your home sale, please get in touch with me at (760) 840-1360 so we can discuss your needs, time frame, and a market and equity analysis, and create a strategy to sell your Carlsbad home, or one nearby, for top dollar and as quickly as possible in 2020.