Understanding Closing Costs: A Guide for Homebuyers
Confused by the term ‘closing costs’? You’re not alone—let’s break it down and make it simple!
Closing costs are a critical part of any real estate transaction, but they’re often misunderstood. When buying a home in Seattle, knowing what to expect can save you from surprises and help you plan ahead.
For sellers, closing costs typically include agent commissions, excise tax, title insurance, escrow fees, and other smaller expenses—amounting to around 7.5% to 8.5% of the sale price. For buyers, the costs are primarily lender-related, such as loan origination fees, appraisal costs, and prepaid taxes, typically adding up to 1.5% to 2% of the purchase price.
Want a deeper dive into what these costs mean for you? Watch this video to get a clear, detailed explanation of closing costs and how to navigate them confidently in your next transaction.
What You’ll Learn in This Video:
- What Buyers Pay: Understand the typical closing costs for buyers, including loan fees, title insurance, and prepaid expenses.
- What Sellers Cover: Learn about the costs sellers are responsible for, such as excise taxes, agent commissions, and escrow fees.
- Negotiating with Closing Costs: Discover how to strategically use closing costs to strengthen your offer and achieve better terms.
Ready to take the next step in your home-buying or selling journey? Watch the video now to get a clear, step-by-step breakdown of closing costs, so you can plan ahead, avoid surprises, and negotiate with confidence!
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From understanding what’s included in closing costs to knowing how much you’ll need to budget, we’re breaking it all down in a simple, easy-to-follow way. Whether you’re buying or selling, having a clear picture of these costs can help you avoid surprises and plan ahead.
Buyer vs. Seller Closing Costs:
Here’s a breakdown of the costs buyers and sellers typically cover at closing, so you know what to expect before finalizing your home purchase or sale.
Closing Cost | Buyer Pays | Seller Pays |
---|---|---|
Real Estate Excise Tax | ❌ | ✅ (1.28% – 2%+ of sale price) |
Agent Commissions | ❌ (Typically) | ✅ (Covers both listing & buyer’s agent) |
Escrow Fees | ✅ (50%) | ✅ (50%) |
Title Insurance (Owner’s Policy) | ❌ | ✅ |
Title Insurance (Lender’s Policy) | ✅ | ❌ |
Loan Origination Fees | ✅ | ❌ |
Appraisal Costs | ✅ | ❌ |
Credit Report Fees | ✅ | ❌ |
Prepaid Property Taxes & Insurance | ✅ | ❌ |
HOA Transfer Fees (if applicable) | ✅/❌ (Varies) | ✅/❌ (Varies) |
Repairs & Seller Concessions | ❌ | ✅ (If negotiated) |
Want a personalized breakdown based on your situation? Let’s connect and go over your closing costs together!
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Your Questions About Closing Costs, Answered:
What exactly are closing costs? Closing costs are the fees and expenses that come with buying a home in Seattle. They can include things like loan fees, title insurance, escrow costs, and taxes.
How much should I expect to pay? For buyers, closing costs typically range from 1.5% to 2% of the home’s purchase price, depending on your loan type and other factors. Sellers usually pay a higher amount, covering excise tax, agent commissions, and more.
Can I negotiate closing costs? Yes! Instead of asking for a price reduction, you can request that the seller cover some or all of your closing costs, keeping more cash in your pocket upfront when buying a home.