Closing costs appear in the final stage of the home selling process, once the transfer of property ownership is finalized between both parties. They may include, but aren’t limited to, taxes, insurance, discount points, attorney fees, and lender fees. The best way to estimate what the total closing costs in a transaction with a mortgage involved is to multiply the purchase price by 2-3%; However, this rule of thumb doesn’t hold true with higher priced properties and I’d recommend consulting with your lender for a more accurate breakdown. Real estate commissions typically total 6% but can be slightly higher or lower depending on the situation. At this point I’m sure you’re wondering who is on the hook for these above-mentioned costs.
Here in Georgia, it’s typical for the seller to pay real estate commissions and for the buyer to cover closing costs. It’s important to note that the seller pays both agents’ commissions: their own agent as well as the buyer’s agent. As a buyer making an offer on a property, you can request the seller to pay a portion or even all the closing costs. In the past this tactic was seen more frequently, but in a hot seller’s market like we’re currently experiencing, the majority of winning offers include the seller paying little to no closing costs. As of March 2021, the average sales price in Georgia has increased to $396,500; In this case, closing costs would fall anywhere between $7,930-$11,895 and total commissions around $23,790.
Leading up to closing day for your home, your goal should be to pocket and sustain as much of your equity as possible. Therefore, it is important to consult with an experienced real estate agent who can provide the best knowledge and insights throughout a transaction. Jimmy Hutchinson is dedicated to guiding, educating and advocating for his clients, striving for seamless transactions and satisfying experiences. Looking to move? Call Jimmy Hutchinson today to arrange a meeting and see how you can navigate around all those selling costs!
"As a consumer in this market myself, I understand how important it is to save money anywhere you possibly can. I pride myself in making the dream of homeownership a reality and can confidently say even in this ultra-competitive market I have successfully negotiated substantial seller paid closing costs for some of my buyer clients. This information shouldn’t discourage you from entering the market, but provide you with a greater understanding of all costs associated in a real estate transaction."
- Jimmy Hutchinson