Who pays certain fees can also depend on location — states have different real estate laws, and counties or cities may have their own standard practices for real estate transactions.

Here is a list of the closing costs buyers and sellers can expect in a real estate deal, followed by descriptions and who traditionally pays:

• Deed transfer tax.
• Recording fee.
• Title search and title insurance.
• Settlement fee.
• Loan application fee.
• Loan origination fee.
• Points.
• Home inspection.
• Appraisal.
• Survey.
• Building or homeowners association fees.
• Existing liens.
• Real estate brokerage commissions.
• Attorney’s fees.
• Mortgage payoff penalty.

Transfer Tax

Who typically pays? Seller, buyer or both.

Often referred to as the deed transfer tax or real estate transfer tax, this is a required fee that’s separate from property tax. The transfer tax is levied for the transfer of the deed to new ownership, and the buyer and seller may negotiate who covers the total cost.

Recording Fee

Who typically pays? The seller, buyer or both.

Title Search and Title Insurance

Who typically pays?The buyer

Before you take ownership of a property, it’s important to make sure there aren’t any existing liens or other claims of ownership

Settlement Fee

Who typically pays? The buyer or seller.

A title insurance company, escrow agent or attorney may handle the transfer of funds in the sale of a property and charge an additional fee for the work done at closing.  

Loan Application Fee

Who typically pays? The buyer.

Some lenders levy a fee upon formal application for a mortgage primarily to ensure the buyer is serious. This is a flat fee, often as small as $25.

Loan Origination Fee

Who typically pays? The buyer.

Loan origination typically covers the underwriting process — when the lender determines whether you are worthy of a mortgage.

Points

Who typically pays? The buyer.

At closing, a homebuyer getting a mortgage may pay additional fees to the lender to reduce the interest rate for the loan

Home Inspection

Who typically pays? The buyer.

During the due diligence period before closing, a certified professional often conducts a home inspection to check the condition of the home and point out maintenance issues, necessary repairs or possible code violations. Some lenders require an inspection to check for defects that may not be apparent in an appraisal, but buyers often opt for an inspection to learn what repairs will be needed after they get the keys.

Appraisal

Who typically pays? The buyer.

Many lenders require an appraisal to determine the property’s value before approving a purchase loan and to ensure it matches or exceeds the agreed-upon sale price. An appraisal helps reduce the lender’s losses in a scenario where the borrower defaults on the loan.

Survey

Who typically pays? The buyer.

A survey may be required by the lender, which naturally falls to the buyer to pay. However, this expense may be negotiated to become the seller’s responsibility.

Building or Homeowners Association Fees

Who typically pays? The buyer.

If the home you purchase is part of a community managed by a homeowner’s association you may be required to join an HOA and pay the associated fees at closing in addition to monthly or annual dues.

Existing Liens

Who typically pays? The Seller

If a lien is discovered during the title search, the issue must be resolved before the deed can be transferred to new ownership.

Real Estate Brokerage Commissions

Who typically pays? The seller.

No doubt that real estate agents get paid once a deal closes. Traditionally, the seller pays the commission to the real estate brokerages that represented both the buyer and seller from the proceeds of the sale, which typically runs between 5% and 6%, split between the two brokerages. The real estate agents then receive their share of the commission.

Attorney’s Fees

Who typically pays? Most of the time the buyers pays for the Attorney. Sometimes the seller requests his own Attorney.

Mortgage Payoff Penalty 

Who typically pays? The seller.

Before you sell your home, check your existing mortgage agreement to see if there are any penalties. Most of the time in Georgia they do not charge.  

Sometimes the seller will pay for some of the closing costs.  This is negotiated when the buyer puts in an offer to purchase. 

—Some information from US News, Devon Thorsby-Editor R.E.

 

THOUGHT FOR THE DAY: One reason a dog is such a lovable creature is that his tail wags instead of his tongue.