After several years of diligently saving money, I’m nearly ready to purchase my first home. Because I’ve been thinking about buying a home for so long, I know exactly what I want my house to look like. I desire a place that has three bedrooms and three bathrooms. I also need a quiet space to set up my home office in. I want a massive, walk-in closet in my master bedroom. My master bathroom needs to have double vanities, a tiled, walk-in shower, and a Jacuzzi tub. On this blog, I hope you will discover how to set priorities during your new home search. Enjoy!
If the time has come to sell your home, you're likely looking forward to the money you'll earn. Whether you'll put that cash into a new home or back into your bank account, it's important to have a good idea of how much you'll have. So, don't forget to take these hidden costs of selling a home into account. You'll need to deduct these costs from your home equity to get an accurate idea of how much you'll actually get to keep from the home sale.
Usually, you'll pay the realtor a fee that equates to about 6% of the home's sale price. So, if the home sells for $100,000, you'll owe your realtor $6,000. This is a pretty big cut into your profits, so it's a cost you really don't want to overlook. You can negotiate realtor fees somewhat, but if your home is at all difficult to sell, you can expect most realtors to demand pretty close to the standard 6%.
Deed Transfer Tax
In most jurisdictions, you'll need to pay a local tax in order to transfer the home's deed to the buyer. This fee varies widely from town to town. In some areas, it may only be a minor charge like $50. In other areas, it may be a percentage of the home's sale price, which can be several hundred dollars. You can call your local building inspector's office or tax assessment office to learn how much this fee will cost in your area.
In most cases, you'll be responsible for paying pro-rated property taxes for the year. For instance, if you sell the home on June 30th, you'll have to pay half the property tax bill for that year—because you owned the home for the first 6 months of the year. If there are any back taxes owed for previous years, these also become immediately due at the time of sale.
Mortgage Recording Fee
The amount still owned on your mortgage will of course be deducted from the money you receive upon sale of your home. But there's also another fee, known as the mortgage recording fee, that will be assessed. This fee varies from bank to bank, and it's usually only $100 or so, but don't forget to take it into account when planning your home sale.
To learn more about these and other costs associated with selling a home, speak to a realtor in your area.