Should we be paying the lawyer fees when we're already paying the realtor a percentage of the house?

Question

We signed a contract with a realtor for 6% to sell our home. Should we still be paying the lawyer fees at the closing? What else are we supposed to pay for as the seller?

Answer 1

Well....JamesNBarnes really gave you a comprehensive reply, which covers just about every scenario possible. But to put it shortly and sweetly, the fee to the real estate brokerage firm ONLY covers marketing the property and procuring a buyer for same.

Any other expenses involved in closing are paid either by seller or buyer, or split according to the agreement in the offer to purchase.

In my state, it is customary for the seller to pay the costs of the deed transfer, title insurance, prorated taxes up to the date of closing, courier fees for handling the closing of your ending mortgage, plus some mandated municipal inspections and certificates.

No, you are not being ripped off.

Answer 2

You are paying the Realtor separately 6% for selling your house only. When your home is sold, if the contract includes agreement that you pay half the lawyer expenses with the buyer they you pay lawyer fees. If the Realtor agreed with the buyer that you and they split the Realtor fees then you need to speak to that Realtor for having made an agreement you did not sign.

Answer 3

Why does that sound like BS? Think about it like this.. you are the one purchasing the home and going "in Debt" by securing a mortgage. The seller is the one who profits from the sale. So who do you think should pay for the services of the proffesional in the transaction? Of course it is the seller, you don't pay anything!! The seller list their home for sale with a Real Estate broker and agrees to pay them a % of the sale their services. The Real Estate broker then puts the home for sale in the Multiple Listing Service (MLS) and advertises to ALL the other Realtors in the area that the home is for sale and they are willing to share a portion of the commision if another Realtor brings the buyer. As the buyers agent your Realtor is going to collect that agreed upon portion of the shared commision for bringing the seller you.. the buyer! So to answer your question... yes you should hire a Realtor and not it does not cost you anything. Best of luck!

Answer 4

If you want to close, you's better! You're only paying the realtor to market and sell your home.

Any additional costs will be negotiable between you and the buyer. But unless you're in a seller's market, expect the buyer to ask you to pay a lot of the closing costs.

Answer 5

You need to see the HUD-1 closing statement so that you can review all the closing costs and compare those costs to the offer to purchase in where you agreed to or not to pay for the costs that will appear. Ask your agent that you want to see the HUD-1 before closing at least 5 days.
HUD Revised Borrower’s Closing costs guidelines: http://www.hudclips.org/sub_nonhud/cgi/nph-brs.cgi?d=MLET&s1=06-$[no]&op1=AND&SECT1=TXTHLB&SECT5=MLET&u=./hudclips.cgi&p=1&r=23&f=G
The HUD-1 closing costs form explained: http://www.alta.org/consumer/hud1.cfm
Best of luck

Answer 6

Here’s what you can expect to pay as a home seller:

Broker’s commission. If you’re using a full-service brokerage firm, expect to pay anywhere from 4 to 7 percent of the sales price. If you’re using a discount broker, or if you’ve sold by-owner, your cost may range from a few hundred dollars to 3 percent of the sales price.
Cost of the survey. Sellers in some states are responsible for giving the prospective buyer a plat of survey of the property. The price for a plat of survey can range from $150 to $600.
Recorded release of mortgage. Verifies that your mortgage has been completely paid off by the sale proceeds, usually $20 to $150.
Courier fee to pay off loan. Typically runs $10 to $50 or more.
Title insurance. In some states the seller must provide a policy of title insurance for the buyer. The cost of the policy depends on the sales price of the home and its cost can vary from a couple hundred dollars to several thousand dollars. Some title companies have added additional charged to the basis title charge. These fees go by the name of “update fees,” “policy issuance fee” and the like. Some fees are as low as a couple of dollars and others up to $100.
Local city, town or village property transfer tax; county transfer tax, state transfer tax, state capital gains tax. The tax man cometh, and it could cost you, although the charges vary from municipality to municipality. In Illinois, the seller picks up the county tax ($.50 per $1,000 of sales price) and the state tax ($1 per $1,000 of sales price, and in some local municipalities, the seller also pays for a local transfer tax. In general, property transfer taxes can range from nothing to $10 per $1,000 of the sales price or more, or you may be assessed a flat fee. In some places, you have to pay a tax on the capital gains generated by the sale of your home.
Credit to the buyer of unpaid real estate taxes. Depending on how and when property taxes are billed in your state, it’s possible that you will have to credit the buyer for real estate taxes that were for the time period you owned the home but will be billed after the closing date of the sale of your home.
Attorney’s fees. If you choose to use an attorney, you’ll either pay a flat fee starting around $350 or by the hour.
FHA fees and costs. All FHA fees used to be the responsibility of the seller, but they are now negotiable. But if the buyer can’t pay the fees, and the seller refuses to kick in a few bucks, the lender may not fund the loan.
Condo/co-op move-out fee. A building charge that can range from nothing to more than $400. Some cooperative buildings can charge a percentage of the sales price to permit the sale of the coop. In some instances these fees can be as much as three percent of the sales price.
Association transfer fees. Often required for condominium and townhouse buyers. Sellers usually are stuck with some of these fees as well. Some of the fees are for processing the sales papers, move-out deposits, preparation of closing documents and even inspection fees.
Paid utility bills. In many areas, local municipal officials will not let you close until you have proven that you are current on your utility bills. The charge for each copy of a paid utility bill, including water, sewer, garbage or electricity is $10 to $50. In some cases, companies can assist a seller in obtaining the proper documentation for the sale and can charge up to $150 to assist in obtaining the documents from the local governmental offices.
Certificate of compliance with building and zoning codes. Your local municipality may charge for inspecting your home prior to the sale to insure that it meets up to date requirements. Such inspections can cost a nominal amount or run more than several hundred dollars plus the cost of fixing any items that are non-compliant. In addition, some municipalities charge a fee to verify the number of dwelling units permitted at a home being sold. The cost of such certificate can be nominal, but it may be a hassle to obtain the certificate.
Home inspection fees. In some areas, local custom dictates that the seller pay for pest, radon and other inspections, which can range from $25 to $200 each. If there are problems with the home, you may have to fix the problems at a substantial cost.
Home warranty. In California, most existing homes are sold with a home warranty, which guarantees to the buyer that all of the mechanical and electrical appliances are working on the day of closing and are guaranteed to work for the first year of ownership. The cost for a home warranty starts around $350 and can increase as additional option items are added. While your home may not be located in California, home warranties are becoming more popular in other states as well, so don’t be surprised if your buyer requests that you pay for one.
Association reserves. In some areas, the reserves held by condominium or homeowner association are credited to the seller on the basis of the seller’s percentage of ownership in the association. Fortunately, for the seller, this is one of the few instances of money coming back to the seller rather than a payment by the seller.
Special assessments to associations. In many associations, if a special assessment has been levied, even if it can be paid over many years, the association will require that the assessment be paid in full at the closing.
Other credits to the buyer. In some cases, sellers give credits to the buyer for things that don’t work, or don’t look nice, in their home. For example, if the buyer’s inspector finds something wrong in the house, you may negotiate a credit to the buyer that will be paid at the closing. The cost of this will vary.
Unpaid mortgage or home equity loan or line of credit. At closing, the seller must pay off any mortgage and home equity line of credits (HELOC) that are relating to the home being sold. The seller must remember that the prior months’ statement for the mortgage or HELOC will not include the interest that is owed on the loan from the last payment date. Almost all mortgages are paid in arrears: you pay last month’s interest in the current month. Therefore, if you made your most recent mortgage payments, you will still owe interest for the current month until the loan is paid off.
Upside down loans. Although it seems unbelievable that anyone could be upside down on his or her mortgage (that is, owe more on the mortgage than the house is worth), many sellers each year will find themselves in this position. If you do manage to find a buyer, and the amount being paid for the home will not entirely pay off your mortgage, home equity loan or line of credit, you’ll have to come to the table with cash in hand. If the lender “forgives” your loan, the IRS may see that as income to you, and you’ll be taxed on the phantom income as if you actually earned it, at your marginal tax rate. Talk to your tax preparer for more details.
It’s important to keep a list of your closing costs, as well as a copy of all your purchase and sales documents, so that you can accurately figure out your home’s cost basis. For more details, check out IRS Publication 523, “Selling Your Home.”

Courtesy of Real Estate Matters Syndicate, PO Box 366, Glencoe, Illinois, 60022.