Who Pay Closing Cost When Buying or Selling Home in Phoenix?
Closing cost is one of the often overlook “hidden fees” when selling or buying a home. Closing costs are fees associated with your home purchase or sell that are paid at the closing process of a real estate transaction. For seller, there are other fees associated with selling your home, other than Realtor’s commission. For buyer, there are fees associate other than home price too.
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Seller’s Closing Cost
Here are lists of closing cost that seller will have to pay:
- Owner’s title insurance premium
- Real estate agent’s commission
- Escrow fee, seller portion
- Any loan fees required by Buyer’s lender (if any)
- All loans in Seller’s name (unless existing loan balance is being assumed by Buyer)
- Interest accrued on loan being paid off, statement fees, reconveyance fees and any prepayment penalties
- Termite inspection and any termite repairs per contract (if any)
- Home warranty premium per contract (if any)
- Homeowner’s Association transfer fee (if any)
- Any judgments, tax liens, etc., against the Seller (if any)
- Recording charges to clear all documents of record against Seller
- Property taxes: pro-rated to date title is transferred plus any delinquent taxes
- Any unpaid Homeowner’s Association dues
- Any bonds or assessments per contract (if any)
How Much is Seller’s Closing Cost?
For home seller, the closing cost typically range between 1% – 2% of the sale price on top of Realtor’s commission. These seller closing cost are paid at the settlement. Typically these will not be cash out of your pocket, rather it will be deducted from the profit on your home, unless you are selling with low or no equity. In this case, you will need to bring cash to the table.
What is seller closing cost when selling a home?
Buyer’s Closing Cost
Here are lists of closing cost that buyer will have to pay:
- Lenders title policy premium, if new loan
- Escrow fee, buyer’s portion
- Document preparation, if applicable
- Notary fees, if applicable
- Recording charges for all documents in Buyers names
- Homeowner’s Association transfer fee, one half (if any)
- All new loan charges (except those required by 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 (if any)
- Beneficiary statement fee for assumption of existing loan (if any)
- Home warranty premium per contract (if any)
- Hazard insurance premium for first year
- All pre-paid items, such as interest, or funds for an escrow account
How Much is Buyer’s Closing Cost?
Typically, home buyers will pay between about 2% to 5% of the purchase price of their home in closing fees. These buyer closing cost are paid at the settlement. These fees are additional of down payment that buyer is putting down.
What is seller paid closing cost?
Closing Cost is Negotiable
Like all fees in real estate transaction, closing cost is negotiable. Home buyers can negotiate with the seller and ask the seller to pay for the buyer’s closing costs. On the other hand, seller also ask buyer to pay for seller’s closing cost.
Conclusion
Whether you are home seller or home buyer, closing cost is the fees that you need to pay to close the transaction. For seller, you want to keep in mind that changes buyer will ask you to pay their closing cost. For buyer, you want to have additional saving or reserve for closing cost.
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Swee Ng, Realtor and Resident in Phoenix East Valley specializing in win-win real estate transaction through great communication and fighting for his clients’ best interest. After all, this is more than real estates, this is about your life and your dreams.If you are looking to buy or sell your home in Phoenix or surrounding area, I would the the opportunity to be interviewed for the job. Contact Us today for complimentary and no obligation consultation. I hope that you will put my experience, knowledge, service and professionalism to work for you.
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