As you know, home purchases and home sales involve closing costs. “What are the closing costs?” is one of our most frequently asked questions. It’s crucial to be prepared, because when we are talking about what is likely to be one of your biggest financial transactions, you don’t want any surprises!
We’ve created a video to give you a quick rundown of the specific fees you might encounter in our area:
Here’s a brief recap of what’s covered in the video:
Realtor Fees: In New Jersey, commissions are negotiable and typically range between 2% and 3% per side. While it’s not required that you compensate a buyer’s agent, there are some excellent reasons to do so. It’s best to have an honest and open discussion with your agent about this as this is the one cost that is most variable
NJ State Transfer Taxes: This is called the NJ State Real Estate Transfer Fee. It is a convoluted calculation that typically results in 1% of the purchase price. There is a discount for seniors, people who are legally blind and/or people with a qualifying disability.
Town-Specific Inspections: Costs and requirements for fire inspections, certificates of occupancy, and permit searches vary by municipality.
Title Insurance: While it’s the buyer who is responsible to purchase title insurance, it is possible that you as a seller may incur some expenses to ensure clear title.
Attorney Fees: While it’s not required, it is absolutely recommended that you engage an attorney because I cannot give you legal advice! Why risk making a mistake with the sale (or purchase) of what is likely your biggest asset?
Prorated Property Taxes and HOA Fees: Your share of property taxes may not have been due prior to closing, so at closing you’ll need to make sure they are paid up through the closing date. Additionally if you are selling a property that is part of a homeowners association, you’ll need to take care of any outstanding HOA fees and/or special assessments.
Home Repairs: Please expect there to be some repairs – even if the buyer has agreed to purchase the property as-is and even if you feel that you have made every repair possible before you put the house on the market.
I hope this information is useful for you! Follow our YouTube channel for more helpful videos.
