Who Pays Closing Costs In Florida?
The most expensive purchase that a person makes in their lifetime is a house. After all fees, inspections and closing costs have been accounted for, homebuyers could spend thousands of dollars.
While sellers may be making financial gains, they still have to pay costs.
Florida Closing Costs Sellers Should Cover
The largest fee sellers will be responsible for is the commission for the real estate agent, which varies depending on the price of the house. Sellers can expect to pay between 5–10% depending on where the house is located.
A seller might also have to pay a commission.
- Mortgage payment- The seller must pay off any outstanding mortgages before closing. Calculating the mortgage payment off must include both the balance and prorated interest until closing day. The lien must also be paid off if the seller has a line of credit attached to the property. Sellers will be responsible for courier fees if the lender is not local.
- Property taxes- Property taxes in Florida are paid one year after the current year. A person selling a house is responsible for all property taxes that were due for the entire time the home was owned. A seller who has a closing date on August 31st must pay any outstanding property taxes between January 1st and August 30th.
- Title examination- A public records search must be conducted before transferring a home. This will ensure that there are not any outstanding liens, judgments, mortgages, or claims against the property. This can cost a few hundred dollars and all liens must be paid before the property is sold.
- Stamp tax for documentation- The seller must pay this Florida state tax (also known as excise tax) upon ownership transfer. It varies from one county to the next depending on the final selling price.
- Pest inspections- Depending on the terms of the buyer’s loan, pest inspections might be necessary. A pest inspection typically costs between $100 and $200. Sellers will usually have to pay this fee.
- Insurance on title- Title insurance is required to cover any claims or defects after the title has been examined. The cost of title insurance can vary depending on where you live and who is paying.
Closing Fees and Other Costs Homebuyers Have to Pay
There are many line-item costs that homebuyers must pay before they can sell their home. The majority of the buyer’s expenses are related to the mortgage required to purchase the house. However, even cash buyers must cover certain costs.
The following may be charged to the buyer at closing
- Closing Fee- The buyer or seller may pay closing costs. Or a combination of both. These costs can vary from a few hundred dollars to a few thousand, so it is important that the buyer and seller clearly spell out who is responsible.
- Appraisal fee- It can cost more than $300 to hire a professional to appraise your home and determine the market value.
- Origination fee- This is a fee that is charged by the mortgage lender and usually amounts to 0.25-to-1 % of the total loan amount.
- Prepaid insurance- A prorated portion of the insurance coverage is due to buyers at signing. This includes private mortgage insurance, homeowner’s insurance, and flood insurance.
- Flood certification fee- This is the price you will pay to determine if your new house is in a flood area.
- Tax service fee- This is the cost to ensure that your property tax payments are correctly credited.
- Credit report fee- This includes the cost of pulling your credit reports for purchase evaluations and lending purposes.
- Bank processing fee- This covers the cost of gathering information necessary to complete your loan application.
This post was written by Dayana Susterman Dotoli. Dayana is the head real estate agent for the Tiffany House In Ft. Lauderdale Beach. Dayana has assisted over 150 individuals with buying, selling, and leasing at Tiffany House. The Tiffany House Residences is a 12 story tower, offers 129 residences, including 1, 2, and 3-bedroom condominiums and townhomes, with exclusive, resort-style amenities and views of the Intracoastal Waterway and the Atlantic Ocean. Click Here for more information.