Who pays for closing costs?

Who pays for what

One very common question of real estate transactions is, “Who pays for what on a real estate transaction?” Below is a list to give you an idea of some of the common expectations, but this list will vary from region to region. Also, if it’s a buyer’s or seller’s market it could possibly change the common fee responsibility.

The SELLER could generally be expected to pay for the following:

  • Real Estate Commission
  • Document preparation fee for Deed
  • Documentary transfer tax
  • Any city Transfer/Conveyance Tax (according to contract)
  • Any loan fees required by buyer’s lender
  • Payoff of all loans in seller’s name (or existing loan balance if being assumed by buyer)
  • Interest accrued to lender being paid off, Statement Fees, Reconveyance Fees and any Prepayment Penalties
  • Termite Inspection (according to contract)
  • Termite Work (according to contract)
  • Home Warranty (according to contract)
  • Any judgments, tax liens, etc., against the seller
  • Tax proration (for any taxes unpaid at time of transfer of title)
  • Any unpaid Homeowner’s dues
  • Title Insurance Premium
  • Recording charges to clear all documents of record against seller
  • Any bonds or assessments (according to contract)
  • Any and all delinquent taxes
  • Notary Fees
  • Escrow Fee

The BUYER could generally be expected to pay for the following:

  • Title Insurance Premium
  • Escrow Fee
  • Notary Fee
  • Document preparation (if applicable)
  • Recording charges for all documents in buyer’s name
  • Termite Inspection (according to contract)
  • Tax proration (from date of acquisition)
  • Homeowner’s transfer fee
  • All new loan charges (except those require by the lender for seller to pay)
  • Interest on new loan from date of funding to 30 days prior to first payment date
  • Assumption/Change of Records fees for takeover of existing loan
  • Beneficiary Statement Fee for assumption of existing loan
  • Inspection Fees (roofing, property inspection, geological, etc.)
  • Home warranty (according to contract)
  • City transfer/Conveyance Tax (according to contract)
  • Fire insurance Premium for first year

 

The information listed above is an example of the costs each party may have in a transaction. Not all transaction are the same and may have different costs.​

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