Congrats! You found a buyer for your home! But beware of those closing costs that follow close behind you and could potentially take a chunk out of your profit. In fact, fees and expenses could devour up to 10 percent of the sale price of your home.
Here are five common closing costs sellers can expect to pay before moving on:
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Taxes
If escrowing into the mortgage, sellers will need to take care of property taxes, which are usually paid in advance – and could be hefty. The seller should pay the prorated share of property tax up to the closing date. (If, however, you’re selling your home and have already paid taxes for the year, you may actually get a rebate at closing. But, keep in mind you’ll have to wait about a month to get that refund mailed to you.) You may also have to consider paying a capital gains tax. Meaning, when you sell a home for more than you paid for it,that counts as a capital gain and might need to be reported on your federal tax return. Lastly, there are also state and county real estate transfer taxes, which varies according to where you live.
Home Repairs
To entice more potential buyers, you’re most likely going to incur the costs of those home repairs you’ve been putting off on your honey-do list. And, why not? It only raised the value of your home. Repairs, such as interior and exterior painting, repairing a leaky faucet, or doing some minor cosmetic work in the bathrooms and kitchen, will only increase the engagement of interested buyers when in search of Carolina Forest homes for sale. Also, be prepared to pay for any home repairs needed after the home inspection. Serious problems, like a damaged roof or sinking foundation, will require some serious finances to avoid buyers walking away from an offer.
Title Insurance
Depending on where you live and your home itself, title insurance could cost anywhere from $2,000 to $3,000 at closing. Be sure to talk to your real estate agent in Myrtle Beach, S.C., early in the sales process to find out if sellers must pay for an owner’s title insurance policy on the home you are selling.
Pre-Sale Home Inspection
While this is optional for the seller to take on, costing upwards of $400-plus, some sellers grin and bear it and pay for a pre-sale home inspection to find out for themselves if their home has any major structural or mechanical issues before the potential buyer’s inspector makes a grand entrance. And before the potential sale price of your home is lowered. Discuss the benefits and options with your real estate agent
Real Estate Agent’s Commission Fees
This is usually the biggest closing fee for a seller at 5 to 6 percent of the sale price split between the seller’s and buyer’s agent. According to a 2018 report from the National Association of REALTORS®, 77 percent of sellers (not buyers) paid for the commission fees. Keep in mind that you may be able to negotiate a lower commission with your agent if the price of the home is high, and will most likely sell quickly in a strong market.
Contact Paige Bird at 843.450.4773 or [email protected] to schedule an appointment to guide you through the process of buying or selling your home.