Sell Your House – Fees and Commissions

Selling a house often involves many fees & commissions.

Here is a breakdown of the most common costs when selling a house:

1. Real Estate Agent Commissions: This is usually the most significant expense. Typically, the seller pays the commission for both their own agent and the buyer’s agent. This fee is usually about 5-6% of the sale price, split between the two agents. For example, on a $300,000 sale, a 6% commission would total $18,000.
2. Closing Costs: These costs can encompass a variety of fees, including:
   • Title Search and Insurance: Ensures the property title is clear of any liens.
   • Escrow Fee: Paid to the escrow company for their services.
   • Recording Fees: Fees to legally record the change of ownership.
   • Transfer Taxes: Some localities impose a tax on the transfer of property.
   • Attorney Fees: If a real estate attorney is involved in the sale.
   • Home Warranty: Some sellers offer a home warranty as an incentive to buyers.
3. Inspection Fees: Though it’s more common for buyers to pay for home inspections, sometimes sellers opt for a pre-listing inspection to identify and fix potential problems before putting the house on the market.
4. Repairs: If issues arise from the home inspection, the buyer might negotiate for the seller to either make necessary repairs or reduce the price of the home.
5. Staging Costs: To make the house more appealing, some sellers hire professionals to stage the house, which involves decluttering, furniture arrangement, and sometimes even renting furniture or decor.
6. Appraisal: If there’s a discrepancy in the home’s value, or if the seller wants to establish a price point, an appraisal might be necessary. Typically, the buyer pays this fee, but there could be situations where the seller might take on this cost.
7. Property Taxes: Sellers are responsible for property taxes up until the date of the sale. If they’ve prepaid for the year, the buyer might owe them a prorated amount at closing.
8. Utilities: These need to be paid up to the date of the move-out.
9. Mortgage Payoff: If you still have a mortgage on the home, the proceeds from the sale will first go towards paying off the remainder of the loan.
10. Possible Penalties: Some mortgages have a prepayment penalty if you pay off the mortgage early.
11. Miscellaneous Fees: Depending on your locality and specific situation, there might be additional costs. For instance, if you’re part of a homeowner’s association, there might be fees associated with selling your home.

Keep in mind that fees and commissions can vary based on geography, local regulations, and the specific professionals you work with. Always ask for a detailed breakdown of costs and consult with professionals to understand what to expect.