What Are Closing Cost Seller Fees?
Closing cost seller fees refer to the costs a seller must pay to close the deal on a house. Generally, there are very minimal closing cost seller fees during the actual mortgage process. However, sellers can sometimes agree to pay a buyer’s closing costs in order to facilitate the sale of a home.
What are Closing Cost Seller Fees?
When a buyer purchases a home, he must obtain a mortgage on that house. This can involve paying an application fee or a fee to originate the loan, called origination points. The buyer may also have to pay for an appraisal and inspection, a title search on the house, and several other closing costs associated with getting the mortgage loan. These costs can sometimes add up to several hundred dollars.
Some buyers, especially those who are stretching to get into a home, may not be able to afford to pay all of the closing costs when it comes time to buy a house. Sometimes sellers roll these costs into their mortgage, borrowing the money to pay them. Other times, though, the buyers negotiate with the seller of the home and the seller agrees to pay the closing costs. In these cases, the closing cost seller fees essentially amount to the seller paying the buyer’s closing costs.
Sellers generally only agree to accept closing cost seller fees in a situation in which they are eager to sell the home and feel that making this concession is the best way to do so. This can often occur in a down real estate market where property values are falling and/or in a real estate market where the supply exceeds the demand.
Since the seller does not have to secure a mortgage when selling a home, the seller generally incurs no closing cost seller fees of his own. He simply receives payment from the buyer and is able to pay off his existing mortgage in full. This doesn’t, however, mean the seller pays nothing at the time of the close.
The seller must pay the fees to his real estate agent who sold the home. Typically, the home seller pays three percent commission to the real estate agent who helped him sell the home and another three percent commission to the buyer’s agent who worked with the buyer. The seller may also have to pay for repairs i the buyer’s home inspection turned up problems with the house itself, if the home owner requests the seller to make the fixes instead of simply requesting the seller reduce the price of the home due tot he problems.
Thus, although there are few closing cost seller fees incurred by the seller along, he may still have a large bill to pay at the end of his real estate transaction.