Closing Costs When Selling A House In The Twin Cities
This list is strictly an estimate and should in no way be held as the true and actual cost. Costs vary based on companies used. Also, depending on the offer, you may pay part of your buyers fees. Selling a house is not as simple as finding a buyer, receiving a payment and handing over the keys. To sell a house in today’s market; you must be an expert or have the help of one in both selling and marketing the property. There are numerous cost associated with getting your home sold that you should be aware of. There are many fees associated with selling a home. It is important that both, home buyers and sellers alike be familiar with the costs associated with such a transaction. Please see the representative list below, along with examples for average costs of selling a home.
Before going into more a more detailed breakdown of costs, I would like to touch on another issue some sellers are struggling with. That is upgrades on the home.
There are many reasons why a home hasn’t been upgraded in years or there is deferred maintenance that would have to be taken care of because the seller can secure the highest possible purchase price for his or her property. There are instances where the it is financially not possible for the seller to pay out large amounts of money.
As an example: A house that hasn’t been upgraded in many years, has kitchen cabinets from the 70’s and appliances from the 80’s , lots of endearing wallpaper that is however not what todays buyers are looking, neither are pink bathroom tiles what is wanted. The carpet is older and the windows are in need of replacement. This house would maybe sell for $200,000 with some repairs and upgrades for around $20,000 the same house could now easily sell for $280,000! The problem that arises is that not everybody has $20,000 to use for the upgrades. Here at Twin Cities Homes Realty we have a solution for you, we’ve got your back! We have partnered with Curbio who will do all the pre-sale upgrades and they don’t get paid until you close on your house!
Commission: Commission is 100% negotiable and will vary depending on experience, location, agency, etc. The realtor fee includes marketing your home, giving tours of your home, setting up open houses, broadcasting to other agents, listing your property on popular sites such as Zillow and Trulia, and posting manual ads on sites such as Craigslist, Facebook, Blog Sites, Main Websites and more as well as negotiating and overseeing the transaction.
Let’s just assume your house sells for $400,000. If the commission you negotiated to sell this home was 6% for example, you would pay $24,000 total. Typically the seller pays the entire commission to both the listing agent and the buyers agent. So it could be that the buyers agent earns $12,000 and the listing agent earns $12,000 to make up that total. It’s up to you and your agent.
There is nothing “set” with commission. Again, commission is negotiable and you may have a variable commission that reduces the cost if the listing agent brings the buyer. That’s called dual agency, and some brokerages will allow it, some will not.
You don’t ever want to choose an agent based on commission. Not all brokers are created equal and the marketing plan brings more showings which brings more offers which generally means a higher selling price and more money in your pocket.
Be careful about choosing a discount broker. You will want to work with an agent who has the budget, tools, and leverage to market your house properly.
Appraisal Fees: Generally several hundred dollars. The appraiser looks at every inch of your house and determines how much it is worth in the current market. Your lending institution requests the appraiser to make sure the value is right for the money they are lending you.
Staging Fees: It is important that your home gives a great first impression to potential buyers. It is very common today for property sellers to hire someone to help stage and prep their home by decluttering, cleaning, and making the home more presentable. Staging can be a few hundred dollars or several thousand dollars depending on how elaborate your staging is. Some furnish the entire home and set it up like a new home model.
Closing Costs – Most of these are small fees, but can add up to thousands when calculated. Ask your lender to get you these estimates.
The act of actually selling your home happens in the closing phase, which contains costs that many consumers are unaware of when selling their home:
– Recording Fees: The cost associated with recording a new deed. The cost is typically split between both the buyer and the seller at the county recorder’s office.
– Title company Fees: A fee that pays for the services rendered by the title company.
– Tax Service: This is a one-time-only fee for setting up tax payments, charged by the lender.
– Transfer Tax: This is a state specific rate
– Home Warranty Plan: This may be an optional fee for a one year warranty that the seller pays.
– There may be other fees that are paid by the seller if the seller agrees to them during the negotiations with the buyer. Sellers can agree to pay any or all closing cost depending on the mutual understanding between the two parties.
Choose an Agent to help you with the process
With the help of a qualified real estate agent, you are more likely to sell your house quickly and maximize your value. You need someone who knows how to sell a Twin Cities house and is familiar with the rules and regulations in the area. As you can see, it can be quite costly to sell a house. Ensuring that you have the best chance to sell your home means spending a little extra. Remember, it is important to look at all costs separately to determine whether you can afford to sell your house before committing to it. Though it seems that it is expensive to sell your house with an agent, keep in mind that the typical For Sale By Owner home sold for $200,000 compared to $280,000 for agent-assisted home sales (2018).
To help you in making the decision to sell contact me so we can talk about what you would like to accomplish and how that might look like and I can estimate your costs!