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What Are the Common Fees When Selling a House?
Before you sell your home, you should first understand how much it’ll cost. These are the most common fees when selling a house.
If you think you can sell your house and keep all the money you earn from the sale, you’ll be in for a rude awakening when you close the deal.
Selling a house isn’t free. Instead, you should expect to pay at least 10% of your selling price for fees and commissions.
Before listing your home, it might be helpful to consider all the fees when selling a house. After all, you’ll have to pay them, and these fees cut into your profits.
Here is a breakdown of the fees you can expect to pay when selling your house through a real estate agent.
If you decide to list your home for sale, your real estate agent will inspect the house to see what work it needs. The agent then makes suggestions for repairs and staging.
If you’re wondering, “how much does it cost to sell a house,” it might be helpful to start with the costs of repairs and staging.
It’s harder to sell a house through an agent if the home is in disrepair. Homebuyers want properties that don’t need work. They want turnkey homes.
While there are buyers that will purchase properties that need work, the buyer pool is much smaller.
The amount of money you must spend for repairs and staging varies. You might not have to spend a lot of money, but there’s also a chance you might need to spend thousands of dollars.
In any case, the money you spend fixing up your home is a cost of selling it.
The next expense of selling a house is the real estate commissions you must pay. When you hire an agent, you’ll pay them for their services.
You don’t pay the home selling commission until closing on the house, but this commission cuts into your profits. In fact, the commission might be the costliest expense of selling.
The average rate is around 6%, and they base this on the home’s selling price. For example, if you sell your house for $150,000, you’ll likely pay around $9,000 in commissions.
Paying $9,000 on your home sale can greatly cut into your profits, though.
Did you know that you can avoid paying a commission and other fees by selling your house for cash? With this method, you keep the entire profit from your home sale.
Pro-rated taxes fall into the category of home selling fees, too. What are pro-rated taxes?
Well, property taxes accrue throughout the year, but you don’t pay them until the next year. When you sell your house, you’re responsible for paying the property taxes for all the days you lived there.
For example, if you sell your house on June 1st, you must pay the previous year’s tax bill plus the amount you owe from January 1st to June 1st for the current year.
This amount reduces the proceeds you receive from the sale, as the title company credits this amount to the buyer’s costs.
The average cost to sell a house varies, as it depends on the agreement and situation. However, one cost you can expect to pay is title insurance premiums.
Title insurance comes in two forms. First, you can purchase a buyer’s policy. Secondly, you can buy a lender’s policy.
When selling a home, the seller pays the buyer’s policy costs in most cases. A buyer’s title policy protects the buyer from any defects found with the home’s title at any time.
The home buyer generally pays for the lender’s policy, protecting the lender against defects with the home title.
Title insurance is a normal part of home sales. However, when selling to a cash buyer, you won’t have to deal with title insurance. The cash buyer won’t ask you to buy a policy, and there’s no lender involved requiring it.
One additional expense of selling a house is the buyer’s closing costs. The person buying your home will have their own expenses to pay for from the purchase. These costs are called closing costs.
When people make offers to purchase homes, they might include a contingency in the offer asking for the seller to pay some of these costs. If you agreed to this in the offer, you must pay these costs.
If you’re under contract with your home, you can look at the purchase agreement to see if you agreed to pay some of these costs. If so, you’ll be required to pay them.
You can add these costs to your list of fees, and you’ll quickly see how much it costs to sell a house. Remember, though, you can avoid paying all these costs if you decide to sell to a cash buyer.
When you add up the total fees when selling a house, you might decide that it costs too much to sell. Did you know that you can avoid all these fees, though?
If you want to sell your house for cash, you won’t have to pay a single fee for the transaction.
We buy houses for cash. When we give you an offer for your home, you’ll know how much profit you can make, as you won’t have any fees.
Contact us to learn how much your home is worth!
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