Thinking of selling your home in Minnetonka and wondering what the costs are associated with that? Well here are the answers that you're looking for. I'm going over some of the basic breakdowns for you on a net sheet so you can see firsthand what the costs are.
Starting with the current mortgage that you have on your property, is not a bad idea to find out ahead of time before you meet with an agent how much you owe. You can ask bank and they can tell you in a matter of minutes plus they can add on any unpaid interest up to a specific closing date. You want to do this with each one of your loans including equity lines of credit because those are considered to be second mortgages. All have to be paid off when you sell your home.
Realtor commissions are negotiable like everything in a contract. When making a decision about an agent you have to weigh their value against the cost of what they're charging you. One thing to consider is that the buyer agents work for the buyers for free because they get paid by the seller. So when you're paying a commission to have your home sold part of the commission is going to the buyer’s agent and their broker. The rest of the fee remains with your listing agent and their broker. Out of that fee your listing agent also pays for marketing, Internet fees, signs and all other market related material.
Title company fees are charged by the title company to get your home to closing. They do property title search, update your title work prepare all of the papers for closing and help to coordinate all documents. This fee can range from $400-$600. It varies from company to company and situation to situation. Some things it can impact the cost are short sales, foreclosures and additional information that would be have to be filed at the County like a divorce decree.
State the tax is charged on the sale of every home. The current cost is about .0033% of the sale price of the home. This can vary by county so you going to want to check to see what your tax table is for the county that you live in.
Recording fees are charged at closing to make sure that the deed is recorded properly at the County and your name is released from the records as the current owner. These fees also range from County by County and are running at about $45 per document.
The balance of any real estate property taxes as well as home insurance will be a credit to you at closing. This will also vary due to the time of year that your closing and how much money you have in your escrow account.
Buyers closing costs may or may not affect you depending on the purchase agreement. Every contract is negotiable so you have to see what that buyer is asking for when they write the offer. It's not a bad idea to be prepared that the buyer could ask for 3% of the purchase price in seller paid closing costs for a conventional loan. For an FHA loan they can ask for up to 6%. This can really impact your bottom line so you want to know ahead of time a rough idea of what these fees are going to be according to what price you list your home at.
Home warranty is available if you want to add it to your listing as an enticement to the buyers. This is not something you have to do; the buyers can also purchase a home warranty on their own. Some buyers will ask for this, the cost is right around $500.
If you live in a townhouse or condominium you have association fees. When selling your home you are required by state law to give the buyer a package of information which includes rules and regulations, current financials and to resale disclosure certificate. The more information you have to go to the Association to get a more this will cost. This is running on average about $200.
Document handling fees are the fees that are charged by the title company to wire an overnight pay off to your current lenders. You want to make sure that when you leave the closing with your proceeds that the rest of the money goes to pay off those outstanding loans. The current cost on average is about $25 per document.
If you want further information or have a specific question you'd like to ask please feel free to call or email. I will be happy to answer all of your questions at no obligation.
Tom Sommers | Edina Realty