Understand The Finances Of Selling A House

When my youngest child moved out, I was left living in a large home by myself. Weekend visits from the grandchildren only filled the space part of the time. The home became more of a burden as each day passed. It was not until I was working with my real estate agent to sell my home and find a smaller home did I realize that there were so many others in the same position. I created this blog to help other empty nesters explore their options for downsizing and to provide guidance on finding a new home that fits in more with their lifestyle.

Understand The Finances Of Selling A House

Understand The Finances Of Selling A House

17 July 2015
 Categories:
Real Estate, Blog


Many homeowners spend money to spruce up their house before they put it on the real estate market. They may naively think that they are done spending money on this house; however, this is not always the case. Talk with your real estate agent or your real estate attorney about the other costs that may come your way.

Real Estate Agent Fees

As the seller, you are responsible for paying your real estate agent as well as the buyer's real estate agent. Currently these fees are about 6% to 7% of the sale price of the home. You can negotiate this with the agency. Find out exactly what you are getting with your contract. You may even be able to negotiate down to 5%.

Seller's Fees

There are a few fees that the seller is automatically responsible for. There may be penalties with your bank for an early loan payoff.

States and cities can also impose a transfer tax fee. This is a fee for transferring the title of the real estate from one person to another. It can be a flat fee, but most states have it as a percentage of the sale price. Your real estate agent will be able to tell you the cost for your state. These range from 0.1% to 1.3%.

Buyer's Fees

Buyers generally always pay the cost for an appraisal of the property and for a home inspection. They accrue these costs after they have entered into an earnest agreement with the seller.

The appraisal is required from the buyer's mortgage lender before the contract can be solidified. As a seller, you should never offer to pay this fee because if the appraisal is not up to the lender's standards than the buyer will not be able to purchase the home. Their earnest contact specifically states that they can back out of the contract and receive their earnest money if the home does not appraise for a certain value.

The buyer should also always pay the home inspection fee. A home inspection is not legally required in most states. The results of the inspection can also give the buyer a way out of their contract. The bottom line is that as the seller, you should never pay for anything that may allow the buyer to back out.

Negotiable Buyer's Fees

The mortgage closing costs are commonly part of the contract negotiation. Without negotiation, the buyer is obligated to pay loan origination fees, title search fees, deed and mortgage preparation costs, recording and transfer fees. If it is a seller's market, you can refuse any offers that require you to put down money towards these fees.

However, if the market is favoring buyers, or you are motivated to sell quickly, you may need to agree to pay some of the costs. Don't blindly agree to pay all closing costs. Rather, offer either a specific dollar amount or a specific percentage of the sale price of the home. 

If you have any questions about your specific situation, visit http://sgcityrealestate.com/.

About Me
Home Buying Tips for Empty Nesters

When my youngest child moved out, I was left living in a large home by myself. Weekend visits from the grandchildren only filled the space part of the time. The home became more of a burden as each day passed. It was not until I was working with my real estate agent to sell my home and find a smaller home did I realize that there were so many others in the same position. I created this blog to help other empty nesters explore their options for downsizing and to provide guidance on finding a new home that fits in more with their lifestyle.

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