Want to know everything about closing costs? Check out our “FAQ” guide below to learn all the essential details. Don’t miss out on understanding what closing costs are really about!
What Are Closing Costs?
Closing costs encompass the various fees and expenses that need to be settled during the property closing process. The specific charges may differ depending on your location, but they generally encompass the following, among others:
Get a clear breakdown of the costs involved in buying a home:
- Notary fees
- Transfer costs
- Transfer taxes
- Appraisal costs
- Inspection fees
- Origination fees
- Recordings fees
- Title insurance
- Underwriting fees
- Bank fees
- Courier fees
- Wire transfer fees
- Liens against the home (if applicable)
- Credit report fees
- Administrative fees
- Attorney fees (if applicable)
- Outstanding mortgage or loans against the home
- Possible repairs or pest control (if agreed upon)
- And don’t forget about commissions!
Make an informed decision and be prepared for all the expenses involved in your home purchase.
Who Pays Closing Costs?
When it comes to buying a property, the buyer usually requests several things, but it’s crucial to recognize that the seller is usually responsible for paying the entire commission, which amounts to approximately 6% or more of the final selling price. Apart from any outstanding mortgage balance, this is the largest expense to consider at the closing stage. However, there is a growing trend of negotiating and shifting other costs to sellers in order to attract more buyers.
As a seller, you are responsible for paying your portion of the property tax for the year up until the day of closing. Additionally, any HOA fees or other community costs should also be prorated and paid at this time.
What Are Seller Subsidies?
This is a negotiable amount agreed upon by the buyer and seller. It represents the seller’s percentage contribution towards the closing costs. For instance, you can propose offering $3,000 towards closing costs to alleviate some of the expenses for your buyer. Generally, providing these subsidies is often a minimal expense that can attract more buyers to consider your property.
Can I Avoid These Costs?
Save money and avoid hassle at closing by partnering with a direct buyer like Birmingham Homebuyers, LLC. Unlike agents, direct buyers don’t charge commissions. They also often cover all closing costs, giving you peace of mind.
If you’re thinking “I need to sell my home fast,” we buy homes as-is in any neighborhood in the Birmingham, Hueytown, Hoover, Gardendale, Fultondale, Alabaster, Pelham, Calera, and Trussville, AL areas in cash.
Contact us today for a free offer on your home!