Although you are receiving a large chunk of money when selling a home, you are also responsible for some costs. Before you sell, you should make yourself aware of what you need to pay and if you are financially able to handle these costs.
Taxes and Fees
No matter what type of sale you go through, there are taxes that need to be paid. Most states will require you to pay a transfer tax for transferring the title of your home. Other fees and taxes might include the cost of the title search or title insurance. Until you reach the closing phase of the sale, you also need to keep up with any fees or taxes. It is your responsibility to pay the property taxes until closing when it then becomes the buyer’s responsibility. If you have any HOA fees, you will also need to take care of these until closing. Some utilities, local taxes, and any other fees should also be maintained until the buyer takes ownership of the house.
In a traditional home sale, one of the largest costs for the seller is paying the commissions of both their real estate agent and the buyer’s real estate agent. Typically, the real estate agent will charge 5-6% of the sale price, which means you would pay 10% of the price to accommodate both agents. However, that is not the case in a cash sale. Cash sales don’t require real estate agents and they typically work better without them. You don’t need to worry about paying a large commission during the closing process.
Another major cost comes before you begin the sale process. While many cash buyers will purchase homes as is, you may still choose to make repairs or even renovations. Some repairs can improve the home and make sure it is safe for the next tenants. These can be costly depending on the extent of the damage. If you choose to do a full remodel, or even renovate one room, this will be far more expensive. Renovations often go over budget and take longer than expected. If you choose to renovate, make sure you are prepared for both the cost and time commitment.
Selling a home will cost you some money. If you want to lower the costs, then you should go with a cash sale. In general, cash sales have fewer closing costs and you can save some money when you sell.
Leverage Companies offer a simple process for selling your home. Click here to learn more and request an offer!
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