As many homeowners eventually learn, cost when selling a house does not always end once you have accepted an offer.
While there are many cheap ways to sell a house, as a homeowner looking to make a decent profit from your sale price, you should always be aware of closing costs when selling a home.
Once you do a little digging, you will find that home selling in New York is expensive! We completely understand how frustrating this can be and are here to help you sort through closing costs.
Making sense of the closing costs when selling a house in New York is paramount to keeping your seller closing costs on budget and your future finances on track. Keep reading to learn more!
What Are Closing Costs?
Once you have closed a deal on selling your home, you will have to deal with closing fees. You might think everything is handled once your closing date has come and gone, but that is not the case.
If you have never heard of closing costs before reading this article, you might be surprised at how much money is needed to pay them all.
Seller concessions can account for 8 to 10 percent of the final sale price, while home buying closing costs represent about 1.5 to 6 percent of the final purchase price.
Both home sellers and buyers have closing costs to cover when selling a home, buying a home, applying for a mortgage, or refinancing one.
What Is Included in House Closing Costs?
Below you will find the most common closing costs associated with a home sale in New York. There may be other closing fees involved, depending on your location.
Transfer Taxes
To transfer the title of your home to a buyer, you will likely have to pay various transfer taxes. These include a State transfer tax and a separate transfer tax involved for residents of New York City.
A title search is also run during the sale to prove that the home seller is the property owner. It also proves that there are no liens or outstanding debts on the house. This search fee might form part of the cost of title insurance.
Commission Fees
When dealing with real estate agents, it is vital to know that realtors or the seller’s agent will receive commissions for selling a house. Those real estate agent commissions are a part of closing costs you will have to cover if you use the services of a realtor or listing agent.
Attorney’s Fees
Legal fees can pile up quickly, and you might need to use money from your home sale to pay off any legal costs for real estate attorneys you accrued during your real estate transaction.
Escrow Fees
While the seller is not responsible for all escrow fees, they do have to cover some of what is put in this particular kind of savings account. Escrow refers to when a third party, such as an escrow company, oversees the money and keeps it secure until a home sale has become completely finalized.
These measures help keep money safe until all the formalities are taken care of. Escrow agreements are generally made between the buyer and the seller before the home sale closes.
Other Charges and Fees
Beyond what we have already mentioned, sellers may also need to cover costs like Homeowner’s Association Fees, paying off their mortgages, recording fees, and even prorated property taxes.
Some other associated costs and fees can be due to home improvements, inspection fees, transfer fees, and appraisal fees.
Who Should Pay House Closing Costs?
While you might be asking yourself why the seller pays so many closing costs, we should again note that buyers have to pay their closing costs, even after they provide a significant downpayment for a new home. They, too, have to cover their own prorated property taxes so that the house is compliant with all local and state laws.
If buyers are working with their realtor providers, they have to pay buyer’s agent fees as well as the buyer’s closing costs. A mortgage lender will usually insist that you cover many of the expenses associated with closing costs before granting a home loan.
There are loan origination fees, or underwriting fees, that the lender charges in payment for preparing your mortgage loan. Lenders also require home inspections before granting loans, especially if the government backs that loan.
Calculating Your Closing Costs
Now that you know all the various closing costs you will have to cover when selling a house in New York, the price is starting to stack up in your head. As stated before, average closing costs in New York can be quite high, from 8 to 10 percent of the final sales price of your home.
For example, the median home sale price in New York is about $765 thousand, and 8 percent of that would total $61,200. Ten percent of that total would be $76,500. That’s a lot of money and time spent paying off costs and fees after you finally sell your house.
If you’re looking to save time, money, and a whole lot of hassle, you can sell your house quickly to a professional home buying company. Luckily for you, we buy houses in New York!
We can buy your home as-is, so you can skip spending all that money on repairs and worrying about the cost of home inspections. Forget about spending time and money trying to figure out all your various legal fees, hoa fees, and realtor commissions – we take care of all those details for you. We offer the best price for your home value through an easy approval process.
Why You Might Pay the Closing Costs
While you can choose not to cover some of the closing costs that come with selling a home, if you do so in a buyer’s market, you could find yourself in a frustrating situation. By agreeing to some seller concessions, you can get your house sold faster instead of waiting around hoping for a great offer.
Figuring out how to balance your closing costs with your final sales price is just a part of selling a house in New York. If that doesn’t sound like a great time for you, there are ways to sell your home without worrying about closing costs.
Whether you choose to work with companies that buy houses in Brooklyn or cash home buyers in Buffalo, you can sell your house fast without worrying about how many of the closing costs you will have to deal with.
The Big Picture
If you sell your home on your own for the first time or with the help of a realtor company, you cannot escape the inevitable closing costs that come with selling a house in New York.
On the other hand, if you sell your house to a professional house buying company, you can get paid fast without worrying about that long list of closing costs mentioned above, saving you more upfront that can be put towards moving costs or relocating to your new life start.
You can spend less of your precious time calculating just how much of your final sales price you will have to kiss goodbye and more time celebrating the sale of your old house for a hefty profit.