tracking pixel
florida cash home buyers

Understanding Closing Costs for Sellers Common Fees Involved in Selling Your Home

we buy houses pensacola

Selling a home involves various costs and fees that the seller needs to consider when calculating their net proceeds from the sale. These costs are collectively referred to as “closing costs.” Understanding the common fees in selling a home can help sellers prepare financially and avoid any surprises during the transaction. This article discusses the typical closing costs for sellers, including what they entail and how they are calculated.

1. Real Estate Commission

The most substantial closing cost for sellers is usually the real estate commission, especially since we buy houses pensacola. Real estate agents work on behalf of sellers to market and sell their property, and they charge a commission as compensation for their services. The commission is typically a percentage of the final sale price and is agreed upon in the listing agreement between the seller and the agent. The commission is usually split between the seller’s and buyer’s agents. The total commission percentage can vary but is often around 5% to 6% of the sale price. 

2. Home Repairs and Improvements

Before listing a property, sellers may make repairs or improvements to enhance its appeal and market value. These costs are not technically closing costs, but they are expenses that sellers should factor in when calculating their net proceeds from the sale as pensacola we buy houses. Common repairs and improvements include painting, landscaping, fixing structural issues, updating appliances, and replacing flooring. While these expenses can increase the property’s market value, sellers should be cautious about overspending on renovations, as they may not always result in a significant return on investment.

3. Title Insurance

Title insurance protects the buyer and the lender from any issues or defects with the property’s title. As a seller, one is typically responsible for purchasing the buyer’s title insurance policy since we buy houses pensacola fl. The cost of title insurance can vary depending on the property’s value and the insurer, but it is usually a one-time premium paid at closing. Title insurance ensures the buyer has clear and marketable property ownership, free from any unknown liens, encumbrances, or competing claims. If a title issue arises after the sale, the title insurance policy covers the costs of resolving the problem.

4. Transfer Taxes

Transfer taxes are fees imposed by state or local governments when property ownership is transferred from one party to another. The transfer tax rate and calculation method can vary depending on the property’s location. In some areas, the seller is responsible for paying the transfer taxes, while in others, the cost is split between the buyer and the seller since we buy pensacola houses. Transfer taxes are usually calculated based on the property’s sale price, and the percentage can range from a fraction of a percent to several percentage points. 

5. Property Taxes

A seller may need to pay outstanding property taxes up to the closing date. Property taxes are typically prorated based on the days each party owns the property during the tax year since we buy houses in pensacola. For example, if the closing occurs halfway through the year, the seller would be responsible for paying property taxes for the first half of the year, and the buyer would be responsible for paying taxes for the second half of the year. The proration ensures that both parties pay their fair share of property taxes when they own the property.

6. Attorney or Escrow Fees

In some states, real estate transactions require an attorney or a real estate escrow company to handle the closing process since we buy houses in pensacola fl. These professionals ensure that all necessary documents are properly prepared, executed, and recorded, and they facilitate the transfer of funds between the parties. The fees charged by attorneys or escrow companies can vary based on the complexity of the transaction and local practices. Sellers should inquire about these fees in advance to budget accordingly.

7. Recording Fees

Recording fees are charged by the county or local jurisdiction to record the deed and other related documents with the appropriate government office. These fees are usually nominal but are essential to finalize the legal transfer of ownership. The cost of recording fees can vary depending on the number of documents needed since we buy houses pensacola. The seller is typically responsible for paying the recording fees associated with the deed and any other documents required to complete the sale.

8. Home Warranty

Some sellers offer a home warranty to the buyer as an incentive. A home warranty is a service contract that covers repairs or replacements of major home systems and appliances in case of breakdown due to normal wear and tear. The cost of a home warranty can vary based on the level of coverage and the provider.

9. HOA Transfer Fees

If the property is part of a homeowners’ association (HOA) or a condominium association, there may be HOA transfer fees associated with the sale. These fees cover administrative costs for processing the ownership transfer and ensuring the new owner knows the HOA’s rules and responsibilities.

10. Real Estate Taxes and Liens

Before the sale can be finalized, the seller must clear any outstanding real estate taxes and other liens on the property. Liens can include mortgage liens, judgment liens, mechanic’s liens, or any other claims against the property.

11. Brokerage Administrative Fees

In addition to the real estate commission, some real estate brokerages charge administrative fees to cover the costs of paperwork processing and other administrative tasks related to the transaction. These fees can vary by brokerage and are usually deducted from the seller’s proceeds at closing.


Selling a home involves various closing costs that sellers need to consider when determining their net proceeds from the sale. If you’re monitoring the value of your home so you can sell it and reap a worthwhile profit, don’t forget to factor in the closing costs for sellers into the sale price.You may estimate that your sale price could be $350,000, which could pay off your $200,000 home loan and reap you a $150,000 profit. But before you start counting your dollars and debating the size of the down payment for your next home, you need to calculate the closing costs for the seller.(1) It’s essential for sellers to be aware of these costs in advance and to budget accordingly to ensure a smooth and financially sound transaction.

Greg Baker

Greg is a resident of Pensacola, FL and has been investing in real estate since 2004. Greg Baker is the passionate founder of Greg Buys Houses, a trusted and reliable cash home buying company based in the beautiful city of Pensacola, FL. With a heart for helping homeowners facing difficult situations, Greg strives to provide personalized solutions that work for each unique situation. He understands the stress and uncertainty that can come with selling a home, and his commitment to honesty, transparency, and empathy has earned him a reputation as a caring and knowledgeable professional. Whether you're facing foreclosure, divorce, or just need to sell quickly, Greg and his team are here to guide you every step of the way.

Leave a Reply

Your email address will not be published. Required fields are marked *

Call Us!