| Closing
Costs for Sellers
Closing day is pay day
(but don't forget about closing costs)
Closing day is rapidly approaching, and you're
looking forward to finally holding that big cheque.
But in all your excitement, don't forget that
you'll have to dole out a little bit of cash before
the deal is sealed in the way of closing costs.
Closing costs are fees owed on or by closing day
that must be paid for your home sale to be complete.
To give you a rough idea of what to expect, some
of the most common expenses are listed below.
These expenses are approximations only, may vary
by region and are prone to frequent changes that
may not be reflected here. Your Royal LePage real
estate agent can help you further define more
precise numbers.
The real estate agent's
commission
This fee covers all the legwork, marketing and
advice provided by your agent, as well as commission
to the buyer's real estate agent (the seller pays
both!). You can expect commission fees to be around
5% of the home's sale price, although they may
be negotiable.
Legal fees and disbursements
When you're involved in a financial transaction
as big as this, you want to be sure you are protected.
Your legal professional will ensure that the buyer
has made good on all terms outlined in the Offer
to Purchase, and that you have met your legal
obligations so the deal may close. Legal fees
vary widely, and the total cost depends on the
extent of services provided. You will also be
responsible for disbursements (any costs related
to handling your file, such as long distance calls
and travel).
Utility and property tax
adjustments
This might not be a cost for you, depending on
how your property tax and utility bill payments
are scheduled. If you prepay these expenses then
you can expect the buyer to refund you the difference
by closing day. If, however, you don't pay these
expenses in advance, it will be you paying the
buyer for the amount accrued prior to the possession
date. The exact amount will be calculated by your
lawyer.
Mortgage prepayment or discharge fees
Be forewarned that if you plan to pay off your
mortgage with the proceeds, your bank may charge
a fee for closing your account, and a penalty
fee if you've paid it off early.
And don't forget about your new house. You'll
want to be sure to budget extra funds for expenses
related to your move (such as the moving company
and utility hookups).
Royal LePage sales representatives are your residential
real estate experts. For helpful advice about
selling your home, contact
Korinne Peachey from your local Royal LePage
real estate office.
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