When it comes to the Palm Beach Gardens real estate market, sellers must be fully aware of their duties and responsibilities. These responsibilities include the closing costs associated with the sale of their Ibis home. Here’s what sellers need to know about closing costs and other fees.
Who normally pays for the closing costs in Florida?
As the final phase of the selling process, closing refers to the consummation of the home sale. During this stage, all parties sign the documents while the mortgage funds are remitted to finalize the sale and transfer of property ownership to the buyer.
At closing, both parties must cover a range of closing costs and fees, which usually include the following:
- Lender fees
- Transfer taxes
- Prorated property taxes
- Real estate commissions
Sellers are responsible for the closing costs, which generally fall between 7% and 9% of the sales price. For Florida sellers, the closing cost fees primarily involve real estate commissions and the transfer of the deed of their Ibis home. Buyers are usually expected to cover closing costs related to mortgage and financing, including lender’s fees.
How much are closing costs in Florida?
Closing costs in Florida vary with location, property type, and the companies involved. With closing costs ranging from 7% to 9% of the final sales price, including the agent’s commission fees, sellers should be ready to fork over about $15,750 to upwards of $20,250 for a home that sells for $225,000.
Examples of closing-related fees and charges include:
- Title search fee (approx. $1,500 to $2,200)
- Transfer taxes and documentary stamp (sales price divided by 100 and multiplied by 0.7)
- Promissory note (mortgage amount divided by 100 and multiplied by 0.35)
- Intangible tax (promissory note amount multiplied by 0.002)
- Real estate commission (approx. 6% of sales price)
- Property taxes (covers only the part of the year that the seller resided on the property)
Closing fees are usually higher for luxury properties as well as properties located in desirable neighborhoods and gated communities. Savvy negotiators might find ways to reduce their closing costs depending on how much interest and competition there is on the home. Serious buyers may offer to cover part of the seller’s closing costs to sweeten the deal.
In a balanced market, new construction builders may offer to pay for the closing costs for buyers by rolling the fees into the sales price of the home. Buyers can make a 3% down payment using the builder’s preferred lender with the builder covering closing costs.
However, in a competitive housing market like South Florida, many builders may forgo this practice, though they may offer to help reduce the buyer’s closing costs.
When selling an existing home, however, sellers can use a mortgage calculator to get a rough idea of how much they’ll need for closing. Most online calculators use averages to provide a cost estimate. For a more accurate idea of how much closing costs will amount to, sellers should get in touch with an experienced real estate agent serving the area.
Call the Telchin Group today
Selling a home in South Florida? The Telchin Group, LLC has been serving clients in and around Ibis since 2013. You can contact their agents at 561.301.0249. You can also send them a message here. The company is led by Eric Telchin, who consistently ranks as the #1 broker in Ibis.