Closing Costs When Selling a House

For an agent-assisted sale, commonly 6% to 10% of the sale price once commission is included, according to Bankrate. Commission is the largest single component; title and escrow, transfer taxes, concessions and small flat fees make up the rest. Excluding commission, the remaining seller closing costs typically fall in the 1% to 3% range, though transfer taxes make that vary a great deal by state.

Both, on different items. The seller almost always pays the real estate commission, their share of title and escrow, transfer taxes where local custom assigns them to the seller, and prorated property taxes. The buyer pays loan-related costs including origination, their appraisal, and prepaid escrow deposits. Which side pays owner's title insurance and transfer tax is set by local custom and is negotiable in the contract.

Add the commission percentage times the sale price, plus title and escrow charges, plus any state, county and city transfer tax, plus concessions you agreed to credit the buyer, plus flat items such as attorney fees, recording fees and an HOA transfer fee. Then subtract that total plus your mortgage payoff and prorated taxes from the sale price. The calculator on this page does exactly that arithmetic with editable assumptions.

You cannot avoid all of them, but you can remove the biggest ones. Selling without an agent eliminates the listing commission, though you take on the pricing, marketing and negotiation yourself. Selling directly to a cash buyer removes the commission entirely and, when the buyer covers standard closing costs as SilverCrest does, removes the title and escrow charges too. Transfer taxes and your mortgage payoff cannot be avoided, only paid from the proceeds.

Almost never. Closing costs are deducted from your sale proceeds on the settlement statement, so you receive the balance rather than writing a check. The exception is a seller who is underwater — if the mortgage payoff plus costs exceeds the sale price, the shortfall has to be covered at closing or negotiated with the lender as a short sale.

Most selling costs are not deductible as expenses, but they generally reduce the amount of gain you are taxed on, which usually matters more. The IRS explains this in Topic 701, which also covers the exclusion many homeowners qualify for on gain from selling a main home. Because the details depend on your ownership history and use of the property, confirm your specific situation with a tax professional rather than relying on a general rule.

Roughly 0.5% to 1% of the sale price on the seller's side is a reasonable planning figure, covering the title search, the settlement agent's work and often an owner's title insurance policy for the buyer. The exact split is governed by local custom — in some states sellers customarily buy the owner's policy, in others buyers do. Ask your title company for a written estimate before you go under contract.

That depends on the cash buyer. iBuyers charge a published service fee and still deduct normal seller closing costs. SilverCrest charges no commission and no fee and covers standard closing costs on our side, so the offer you accept is the amount that reaches you, less only the items attached to the property itself — your mortgage payoff, any liens and prorated property taxes. Ask any buyer for that net-to-you figure in writing.