Is there closing costs on homes for sale by owner?

Answer 1

If you are financing then yes there will be closing costs.

Answer 2

$8000 is probably about right. We just bought and the closing costs were around that. Since you're financing you will need 5% down to even get financed so theres $3750 you need just to get the loan. You'll pay for an appraiser that your finance company chooses which can be $300-$500. Then there will still be title and other document fees you'll have to pay a full year of homeowners insurance at closing too. If a real estate attorney is involved they can charge $200 (or more) an hour and they will charge you for every minute they spend on your file. You're loan officer should have given you a good faith estimate with the estimated closing costs. That's really the only person who will have an accurate answer for you. Technically, you only need the 5% and then you can add the closing costs to your loan. I think there are even some loans that you only have to put 3% down. Also, talk to your loan officer about grants that might be availble to you too. Or look into it yourself because the government will pay you're dp or give you cash if you qualify. But you're not saving any money without realtors involved you're father in law is just getting a little extra cash in his pockets. There will still be title company fees it's not as simple as a lawyer just drawing up some papers. There's other BS fees when you look at the paperwork. Best of luck to you though!

Answer 3

Yes. There are what we call "non-recurring closing costs" that have to be paid with every real estate/financing transaction.

The biggest part of a "normal" transaction is the real estate commission--which can be up to 6%. By doing a "for sale by owner" you are bypassing that expense.

But, the other costs (that we figure averages about $3200 per transaction here in NC) include such things as: Title insurance; Loan Underwriting; Processing; Doc Prep; Recording and Tax Certification; Tax and Insurance prepaids; Courier and Notary expenses, etc. You may or may not have all of these, but a lot of these costs are for professional services that you want to have done to make sure that the title is clear, and you are protected.

But, if you can do a deal without having to pay the real estate commission, you can save a BUNCH of money, even if you do still have these costs!

Also, a lot of these costs can be negotiated between buyer and seller. I do not know which side of the transaction you are on, but as the seller, you can offer to pay some of the closing costs as an incentive to the buyer, and as the buyer, you can ask the seller to help with the c/c as part of your offer...

Good luck!

Answer 4

2

Answer 5

of course any home sale the buyer has to get a mortgage and there are closing costs on the loan, they can also be financed into the deal on what is known as a seller concession, lets say you both agree on a price of 300k and closing costs are going to be 3 % about 9k , you can ask them to do a 3% seller concession meaning they will sell the house for 309k and give you 9k at closing to cover most of your closing costs, doesn't really hurt the seller (nothing to lose) and only works if the house appraises for 309k or more

Answer 6

MOST closing costs are not related to the Realtors commission. The following is a ample of items from my 3 year old closing:
Appraisal Fee
Other loan related fees
Property taxes
Title search
Title insurance
Deed Recording fee

Realtor's commission was about 40% of total closing costs.

Answer 7

The closing costs are disclosed to you depending on the mortgage lender you are using. Your lender is required to supply you with initial disclosures (Truth in Lending, Good Faith Estimate, etc.) within 3 days of your application so you can compare the true cost of the loan. The seller of the property doesn't impose the closing costs (those are fees associated with the mortgage loan).

Answer 8

Yes, and they can be negotiated between the buyer and seller.

For example, you can write into a buyer-friendly contract of your own that the seller pays most or all of the closing costs (or vice versa as a seller). Or, they can be split according to what is customary.

HOWEVER...If you want to reduce closing costs, ask about doing that on the free forum at creonline.com.

Answer 9

Yes. There are closing costs on ALL homes.

Answer 10

Of course. There are closing costs on every RE transaction, even if it is a cash sale.