6 Closing Costs for Home Sellers You Shouldn't Underestimate

With the current seller’s market, along with high demand and low inventory, many homeowners are dabbling with the idea of putting their house up for sale.

But beware — if you’re ready to find an agent and list your home for sale, there are many hidden fees involved with selling a home that you will want to be prepared for ahead of time.

You want to avoid surprises in the home-selling process and understand the ins and outs of closing costs for sellers — from what’s included to how to negotiate a better deal.

For starters, closing costs are the various fees paid – some by the buyer, some by the seller, in order to finalize the home buying transaction.

Closing Costs for Home Sellers 

1) Agent Commission

The most significant cost that home sellers are responsible for is agent commission fees.  Commission rates are usually around 5-6% of the final sale price, split between the buyer's and seller's agents.  Therefore, on a $300,000 home, commission fees could total $18,000.



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2) Transfer Tax

Although sometimes these fees are split, it's pretty common for the seller to cover these costs.  These taxes are usually represented as a percentage of the final sale price and vary by state and location.

3) Title Insurance

There are two types of title insurance — lender’s (which protects the lender) and owner’s (which protects the owner). The question of who pays the owner’s title insurance depends on the state where the property is located.

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