Settlement Fees – the fees charged by the title company to perform title research, verify all financial information, prepare all settlement paperwork, perform the settlement with a Settlement Attorney, disburse funds and record the deed and associated forms. While regulated, fees may vary somewhat from one title company to the next.
Taxes – The owner pays two types of taxes at settlement in Northern Virginia. One is a transfer tax and the other is called “congestion relief tax.” At present, generally expect to pay about 0.25% in taxes.
Commission – usually this is the largest expense. In our market it is customary for the seller to pay commissions for both sides – buyer and list side. Commissions vary and are set between each broker (real estate agent) and client. For a regular sale, commissions are generally 3% to buyer side and 3% to list side.
Homeowners Association Documents – if you live in a community governed by a homeowners or condo owners association, you’ll be required to pay for a “resale package” to be delivered by the HOA or Condo Assn to the buyer for review. Cost is regulated but can run between $50 to $300, sometimes more in special cases. The association will inspect your home prior to sending the documents to the buyer – should they note any violations or if any dues are late, you’ll need to take care of this before or at settlement.
Termite inspections – sometimes paid by seller, and sometimes by buyer (consult your contract). Generally these run less than $75. Should the inspector find evidence of termite damage or active termites, the seller is required, by contract, to treat and make needed repairs.
Home warranty – Some sellers will offer, or agree to pay for, a home warranty for the buyer. These protect the buyer in case there is a needed repair during the first year they own the home. Sometimes the home warranty can also be used to make repairs requested by the buyer prior to settlement. Home warranties run between $350 to $550, in general. It’s optional, but ask us whether we feel it’s a good idea to offer one.
Repairs – after the home inspection, the buyer may negotiate with you to make some repairs to the property as a condition of sale. It’s good, but not always possible, to fix as much as possible before putting your home on the market. Buyer repair requests can range from a fixing a leaky drain, to a new roof and windows, or furnace. Having your real estate agent negotiate this on your behalf is critical. More contracts fall apart at this stage than at any other! Budget between $500 to $1000 for repairs, but hope to pay less. If you know your roof is leaky and old, or furnace is on its last legs, expect these may be deal-breaker repairs for the buyer and budget accordingly.
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