8 Expenses of Selling Home You Should Prepare for when Selling Your Home in Arizona
How much does it cost to sell my home? Do I have to pay out of pocket when selling my home? You may ask… The cost of selling your home also known as seller closing cost, it the cost to sell your home. Closing costs for sellers can be tricky, especially it is your first time selling a house. Some seller closing cost may even seem hidden that you may be no aware of but you can (and should) be prepared when you come to closing table. Here are 8 costs of selling your home you can expect to pay when selling your home.
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1. Mortgage Loan Payoff
If you bought your home with mortgage and still has balance, big chunk of your proceed with go pay off your mortgage. Once your home is under contract and in escrow, the escrow officer will request loan payoff from your mortgage company. Your mortgage company will provide the loan pay off plus interest on the specific date, normally will be the closing date.
2. Realtor’s Commissions
The other major costs of selling your home are real estate agent commissions. When you hire a real estate agent to sell your home for you, the typically commission is 6% of the final sales price. The sellers agent will split this commission with the buyers agent.
Read: How does Real Estate Get Paid?
3. Buyers Title Insurance Policy
In Arizona, the seller is required to pay for buyer’s title insurance policy to ensure buyer has clear title to the property. Title insurance policy will describe the property and outline any recorded limitations on your ownership. It will also set forth the title insurance company’s responsibilities should any claim covered by the policy terms arise.
Read: What is Title Insurance?
4. Escrow Fees
This is a service fee paid to escrow company. Escrow is one of the important process in any real estate transaction. Escrow is an independent, neutral intermediary that manages the exchange of money for real property. The main job for escrow is to ensure no funds or property will change hands until all of the instructions in the transaction have been followed and conditions met.
Read: What You Need to Know About Escrow?
5. Property Taxes
Property taxes in Arizona are paid in arrears. So, it is depending on what time of the year you sell your home, if you are current on your property taxes you may have pay prorated property tax or you may get some credited back to you from your escrow account.
Read: Understanding Property Tax in Arizona
6. HOA Fees
If your home has homeowner association, you will need to pay the disclosure fee as required by Arizona law. Another may be HOA Transfer Fees. This is a fee the HOA charges to update their records to change the name on the property from the seller to the buyer. The fee can be paid by the buyer, the seller or split between the two.
7. Reconveyance Tracking Fee
If the seller has a mortgage on the property, there is also a reconveyance fee charged by the title company. This is a service to make sure their lender shows the ownership transfers property and releases their lien on the property.
8. Buyer Closing Costs or Credits
Depending on the offer you had received. Sometimes a buyer will ask the seller to pay part of buyer closing costs or home warranty. If buyer is asking seller to pay, it will be stated in purchase contract. Seller may also credit buyer for some minor repairs requested by buyer, as stated in BINSR.
Read: What Closing Costs Can the Seller Pay?
Conclusion
In Arizona, the cost for selling a home is typically range between 1 – 2% of the sale price. All these cost are paid at the settlement. Most of the time these won’t be cash out of your pocket, rather it will be deducted from the profit on selling your home. Unless you are selling with low or no equity, then you will need to bring cash to the table.
Selling your home in Phoenix AZ
Contact Us or call Swee Ng at 480.721.6253 today to discuss your potential Phoenix House Value and our comprehensive marketing plan. We will prepare complimentary competitive market analysis (CMA) to find out what your home is worth at today’s market.
Swee Ng, Realtor and Phoenix East Valley resident specializing in win-win real estate transaction through great communication and fighting for his clients’ best interest. After all, this is more than real estates, this is about your life and your dreams.
If you are looking to buy or sell your home in Phoenix AZ area, we hope you will consider us. Contact us today for complimentary consultation.
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