How much will it cost me to sell my home?

When selling your home, you know there will be closing costs, yet do you have any idea what the costs will amount to and by how much they’ll reduce your profit when it’s time to sell your home? I’m sure you want to know how much money will be wired to your bank account. The more, the better, of course! This is a common question that I field from homeowners as they get ready to sell their homes; How much will it cost me to sell my home? What are the costs to selling a home?

You will know what to expect when you sell a home by reviewing your closing costs, commonly referred to as Settlement charges, which can and will vary from state to state, so what you see here in South Florida, may not be common place in another state. Ideally, you’ll review the settlement statement (HUD-1), regulated by the U.S. Department of Housing and Urban Development (HUD) several days prior to closing. On the HUD-1 , you’ll find the itemized charges for both the Buyer and the Seller which is the official settlement form used for the purchase and sale of Real Estate. You can expect to find the following most common charges:

The most common settlement charges (closing costs) we’ll discuss here:

Settlement/Closing Fee – This fee is charged to both the Seller and the Buyer. This fee can average anywhere from $400 – $900 and the amount paid will vary amongst Closing Agents for the settlement/closing service provided. This is the fee charged by the Closing Agent who will process your closing. This is meant to simply provide a rough estimate.

Abstract or Title Search fees – These charges are for the process of examining who has interest in or claim to the property being sold and what might be attached to the property. This examines the ownership history of a home. This fee can average between $200 – $300.

Attorney Fees – If you are being represented by an Attorney, you’ll have to pay the fee for their services. (contact your Local Attorney for cost estimates, if using).

Title Insurance – Here in Southeast Florida in the county of Broward, it is standard for the Buyer to select the Title company for closing and therefore pay for Owners Title Insurance. In the county of Palm Beach, it is standard for the Seller to select and pay. Of course, as I say “standard” this is a negotiable term of the Real Estate Purchase Contract.

State Recording Stamps on Deed – You will pay .70 per $100 of the purchase price.

Lien/Municipal Search fee – This fee varies from approximately $150 – $225.

Recording Fees – You can expect this fee at about $27.

Document/Courier/Wire fees – Can average $100.

Homeowners Association Estoppel Fee – If you live in a neighborhood that has a Homeowners Association, you will pay an Estoppel Fee which is an accounting ledger of what is owed on your account, if any. The fee for the Estoppel letter can average between $150 – $350, for example. The Estoppel letter will detail your account balance whether monies are owed or not.

County Property Taxes – You will pay the taxes from January 1st through the day of closing which the Buyer receives in the form of a credit.

Brokerage Commission Fees – Realtors commissions are typically paid from the Seller’s funds at settlement. The standard fee is 6%. A skilled, trusted Real Estate professional that you hire should be well worth the commission that they are paid making the difference in you selling your home for top dollar or not; it’s that simple. You need to feel comfortable knowing that they’ve got your back.

Seller Contributions – Also, should the Buyer request Seller assistance for closing costs, this cost will appear on your settlement statement/HUD as a closing cost credit to Buyer which can range from 1% to 6% of the purchase price. This cost is optional and not a requirement of closing, yet shown here as something you may consider in the selling of your home.

The costs listed above are your most common costs that you’ll incur when selling a home. It is not meant to be all inclusive or a representation of exact costs. This simply shows a guideline for you to have an idea of what to expect. Knowing what to expect prior to selling your home, is always beneficial, as most don’t like surprises, particularly when it comes to money! When considering Realtors to sell your home, you’ll want to make sure that they go over a Seller’s Net Sheet with you that will highlight the costs that you can expect to pay and when you add in any mortgage balances, you’ll know how much you’ll be profiting from the sale of your home.

What steps are involved in selling a home?

Review Buyer’s offers to purchase your home.

You’ll want to make sure the Buyers Real Estate Purchase Contract is reviewed thoroughly by you and your Real Estate Agent. This is where Step #1 becomes even more important. Here in Florida, it is not a requirement to use a Real Estate Attorney, so you’ll want to make sure you’re represented well with your selected Real Estate Agent, particularly if you haven’t hired an Attorney. Besides the purchase price, of course, you need to pay close attention to any and all filled in spaces such as; deposits, financing commitment periods, title evidence, assessments, inspection periods, closing dates, addenda, any additional added terms and signature dates just to name a few of the main areas to pay attention to on the Real Estate contract and addenda. It’s also very important to pay close attention to timelines used and that they are computed correctly, as to not be in conflict with one another.

Also, included in this step is to confirm Buyer’s financial ability to buy your home, if they’re financing. A Buyer simply having had a conversation with their Lender over the phone providing verbal numbers as far as their credit, income and assets will not provide you with confirmation of the Buyer’s ability to purchase your home when the Lender then spits out a letter indicating the Buyer is Pre Qualified. This is simply a waste of everyone’s time. The Buyer’s credit, income and assets need to be reviewed by their Lender in order to accurately determine credit, income and asset worthiness and provided in a writing as a Buyer’s Pre Approval Letter. As a Real Estate Agent, I will be sure to go over this with the Buyer’s Lender also. Keep in mind, that this does not guarantee the Buyer’s ability, however it will provide you with the most assurance that you will have at this point, of the Buyer’s ability to gain final loan commitment.

If they’re paying cash to purchase your home, you’ll want to see their proof of funds. These funds must be liquid funds not tied up in stocks, bonds, mutual funds or other investments not liquid. The statement of their account also needs to show that the funds are in their name and not say, for example, in the name of a relative or friend. We buy houses Schaumburg

Prepare for your home’s inspection

A Buyer will hire an Inspector to thoroughly inspect your home to make sure there are not any major issues to contend with in the purchasing of your home. The inspection will detail all the little items and uncover any major items that they’d need to address. This may involve negotiations according to inspection results. Read here to find out more about the inspection process.

Make preparations to move

By now, you should have been considering where you are going to be moving to, if you didn’t know prior to deciding to sell your home. Typically, once you have a signed executed Real Estate purchase contract, you’ll have roughly 30 days in which to move. Of course, keep in mind that a closing date can also be negotiated with the Buyer. The day of closing is when the Buyer takes possession of your home so you’ll want to plan accordingly.

Keep home in same condition as when Buyer submitted offer.

Phew, it was tough to get your home ready and to keep your home in tip top shape. Now that you’ve made it all the way to this point, it’s time to relax and don’t worry too much about what goes on at home; don’t even think about it! Now more than ever you need to keep your home in the same condition as when the Buyer initially fell in love with your home, as the Buyer’s are going to want to see your home again, very soon, as Step #13 reveals.

Be advised of Buyer’s financing progress

If the Buyer of your home is financing their purchase, you’ll want to make sure that you are kept informed of the loan progress and that all is moving along satisfactorily. The Buyer’s loan commitment date according to the Real Estate purchase contract is important to be aware of, as that is a date that must be met so the Buyer is not in default of the contract. Far too many, don’t pay attention to this critical date. Missing this date and not keeping you, as the Seller, advised can have the Buyer forfeit their escrow deposit should anything happen with the sale not being completed.

Title Company preparation for Real Estate closing

The Title Company plays an important role in making sure that the Title is clear for a deed transfer to the new Buyer. They will provide the Buyer with a Title Commitment through proper examination which also includes a search of any possible existing liens or open permits that exist for the property. If any existing liens or open permits exists they will have to be resolved prior to closing.

Get moved out leaving home neat and clean

Closing date is just a few days away. You’ve made your preparations to move and the moving company knows when to arrive to get a lifetime of memories safely relocated to your new place to call home. It’s important to leave your home clean upon your departure.