Closing Costs That Might Surprise You

Selling your home soon? As you look at your finances and list your home, it's probably tempting to focus on your potential earnings. However, every real estate transaction comes with closing costs for the buyer and the seller.

You probably already know you're responsible for the agents' commissions, but what about the rest of your closing costs?

Before selling your home, make sure you understand all the closing costs you'll be expected to cover. Here are some common costs that may surprise you:  

1. Pro-Rated Property Taxes
   You're responsible for all property taxes up to the date of the sale. That means if you're selling in July, you need to pay your property tax for the first seven months of the year — not wait until next year to file. Make sure you're aware of the final number because you must provide this to the buyers. This is required because buyers will get a bill next year for the whole year, including the months you still owned the home.
   
   
2. Transfer Taxes and Fees
   Real estate transactions are essentially title transfers from one owner to another. Before your sale is complete, you must pay state and county or city fees in order to process this transfer. You may also need to pay transfer taxes. While most sellers are aware that it costs money to transfer a title, many are surprised by the final percentage, which can fluctuate wildly depending on your location. Make sure you're aware of the local requirement beforehand.
   
   
3. Title Insurance
   If you think buyers are always responsible for buying a title insurance policy, think again. Many states now require sellers to cover the new homeowner's title insurance policy. This coverage is designed to protect the mortgage lender from any future claims, and they won't approve the transaction without it. Find out now if you will be responsible for the buyer's title insurance coverage.
   
   
4. Home Preparations
   Staging a home for market success is about more than just cleaning thoroughly and rearranging the furniture. Your real estate agent will know which services are the most valuable, especially to sellers who want to ask for more money or sell more quickly. For example, renting a storage unit will make it much easier to clear out a third of your clutter and personal possessions, leaving a more neutral and walkable space for potential buyers. Carpet cleaning, painting, lawn care, and professional photography services are also important investments for serious sellers.

Of course, your final closing costs before selling your home will depend on a lot of different factors. From zip code and loan terms to the buyers' willingness to negotiate, these factors will help you figure out just how much to set aside for closing. Understand your responsibilities and prepare yourself for every possible expense.

• Does Your Water Heater Need Replacing?
• 6 Easy DIY Insulation Projects
• Help For Choosing The Right Siding
• You Might Have A Drainage Problem If…
• How To Pick Window Treatments For Your Home
• 10 Reasons To Start Green Cleaning Today
• 10 Tools For the New DIYer
• 5 Simple Ways To Allergy-Proof Your Home
• Is Your Garage A Disaster?
• Home Renovation Projects Well Worth The Investment

• 6 DIY Projects For Newbies
• Closet Organization — It's A Thing

• 5 Reasons Buyers Pick Move-In Ready Homes
• What Is A Backup Offer And Should You Make One?
• Red Flags To Watch For At An Open House
• Buying A Home? Minimize The Time & Maximize The Results
• 7 Things Everyone Should Do In A New Neighborhood
• Make Any Move Easier With This Simple List
• 5 Tips For Buying A Home In A Different State
• Here's Your Home Buying Blueprint
• Home Buying Advice: Seal The Deal With Your Purchase Offer
• 5 Mistakes To Avoid In Your First Year As A Homeowner

• 4 Benefits Of Buying A Home When You're Young
• What Is Private Mortgage Insurance?

• Fielding A Lowball Offer
• How To Tell Which Offer Is The Best One
• 10 Signs You've Outgrown Your Home
• What Every Home Seller Needs To Know About Closing Day
• Selling Your Home? Here's What You Need to Know
• Staging Mistakes That Can Sabotage Your Sale
• 8 Tips For Ousting Awful Pet Smells From Your Home
• Selling A Home? Don't Bother To Fix These Things
• Buyers Will Text
• Kitchens Sell Houses

• 6 Step-By-Step Home Selling Tips
• Rookie Mistakes That Can Bench Your Home Sale