Selling a home is a major financial transaction, and while many sellers focus on the listing price and final sale price, it’s just as important to understand what you’ll actually net after everything is said and done. That’s where closing costs come in.
These often-overlooked expenses can significantly reduce your profit, especially if you don’t plan for them in advance. If you’ve ever asked:
- “What are closing costs?”
- “How much will I owe as a seller?”
- “Can I avoid any of these fees?”
- “What’s the easiest way to sell my house without all the extra charges?”
You’re in the right place.
Let’s break down everything you need to know about closing costs, how they affect your bottom line, and how you can avoid most of them by working with a cash home buyer.
What Are Closing Costs?
Closing costs refer to the various fees and expenses that both the buyer and the seller must pay at the closing of a real estate transaction. These costs cover the legal, administrative, and financial services needed to officially transfer ownership of the property from the seller to the buyer.
While buyers often pay the lion’s share of closing costs—especially for mortgage-related fees—sellers have their own set of obligations, which can total thousands or even tens of thousands of dollars.
Why Do Closing Costs Exist?
Selling and buying a home involves a lot more than just handing over keys. You need:
- Legal paperwork and title verification
- Government tax documentation
- Real estate agent support
- Escrow handling
- Compliance with local/state regulations
All of these come with associated costs. Ignoring them could lead to legal or financial issues, which is why closing costs are mandatory in almost all traditional real estate transactions.
What Does the Seller Typically Pay for in Closing Costs?
Now let’s dive deep into what sellers are expected to pay at closing. Some of these costs are negotiable, but most are standard and unavoidable unless you choose an alternative sale method.
1. Real Estate Agent Commission (5%–6%)
This is the largest closing cost sellers usually face.
In a traditional sale, the seller is responsible for paying the commission for both their listing agent and the buyer’s agent. This commission is deducted directly from the home sale proceeds.
- Typical Range: 5%–6% of the sale price
- Example: On a $400,000 home, you could pay $24,000
Important: Even if your home sells in a week, you still owe full commission unless negotiated differently up front.
2. Title Insurance (Owner’s Policy)
Title insurance protects the buyer against potential claims, errors, or disputes regarding property ownership.
- What it covers: Fraud, clerical mistakes, unknown heirs, undisclosed liens
- Cost Range: $500–$1,500, depending on home value and location
In many states, sellers are expected to pay for the owner’s title insurance policy, while buyers cover their lender’s policy (if they’re financing).
3. Transfer Taxes / Recording Fees
These are taxes and charges imposed by city, county, or state governments for recording the sale of a property.
- Typical Costs: 0.1% to 2.5% of the sale price
- Who Pays: Often the seller, though it varies by state
Example: In New York City, transfer taxes can exceed 2%—a huge hit on high-value homes.
4. Escrow Fees
Escrow is the neutral third party that holds funds and documents during the sale process to protect both parties.
- Services Provided: Disbursing funds, coordinating documents, managing legal filings
- Typical Fees: $500–$2,000
- Payment: Usually split 50/50, but negotiable
5. Attorney Fees (in required states)
Some states (like New York, Georgia, and Massachusetts) require an attorney to be present at closing. Others allow but don’t mandate attorney involvement.
- Average Cost: $500–$1,500 or more depending on complexity
If your transaction involves special circumstances (foreclosure, probate, divorce), attorney fees may increase.
6. Outstanding Liens, Judgments, HOA Fees, or Property Taxes
Before a home can be sold, all outstanding financial obligations tied to the property must be cleared.
These may include:
- Unpaid property taxes
- HOA dues or fines
- Municipal liens
- Utility bills
- Judgments from court decisions
These are paid at closing and will be deducted from your sale proceeds.
7. Repair Credits or Concessions
After the home inspection, the buyer might request repairs—or a credit toward closing costs.
Rather than fixing issues yourself, you may agree to:
- Reduce the sale price
- Offer a flat credit (e.g., $5,000 for roof repairs)
Be cautious: A poorly negotiated credit could end up costing you more than handling the issue upfront.
8. Home Warranty (Optional, but Common)
To give buyers peace of mind, some sellers offer a one-year home warranty that covers basic systems like plumbing, electrical, and HVAC.
- Cost: $300–$600
- Benefit: May help your home stand out in a competitive market
How Much Are Closing Costs for Sellers on Average?
Here’s a simplified breakdown for a $400,000 home:
| Expense | Amount (Est.) |
|---|---|
| Agent Commissions (6%) | $24,000 |
| Title Insurance | $1,000 |
| Transfer Taxes | $2,000 |
| Escrow Fees | $1,000 |
| Attorney Fees | $1,000 |
| Repair Credits | $3,000 |
| Property Taxes & Dues | $2,000 |
| Total Estimated Costs | $34,000 |
That’s 8.5% of the total sale price. For many sellers, it’s a shock when they see how much their “final price” gets reduced after fees.
When Do You Pay Closing Costs?
As a seller, you don’t typically write a check for closing costs—they’re deducted from your final proceeds at the closing table.
For example:
- You sell your house for $400,000
- You owe $34,000 in closing costs
- You walk away with $366,000 (before paying off any mortgage balance)
However, if your sale price doesn’t cover all debts and fees, you may be required to bring cash to closing.
Can You Reduce or Avoid These Costs?
The short answer is yes—but you’ll need to be strategic.
🧾 1. Negotiate Agent Commissions
Agent commissions are not set in stone. While 6% is standard, many agents are open to negotiating lower rates—especially in:
- Hot markets
- High-value transactions
- Dual-agency deals (when one agent represents both parties)
Tip: Always negotiate the commission structure before signing a listing agreement.
⚖️ 2. Push Back on Repair Credits
After an inspection, don’t automatically agree to every repair demand. Some requests are minor or cosmetic.
Options include:
- Refusing the credit
- Offering partial coverage
- Agreeing to fix critical issues only
Remember: The buyer wants the house as much as you want to sell it.
🧠 3. Sell FSBO (For Sale By Owner)
By selling your home yourself, you can avoid paying the listing agent’s commission. However, you’ll need to:
- Market the home
- Show the property
- Handle negotiations and paperwork
It’s more work—but you could save 2.5–3% of your sale price.
💰 4. Sell to a Cash Buyer Like PineCone Properties
This is the simplest and most cost-effective option. A reputable cash buyer will:
- Buy your home as-is
- Pay all standard closing costs
- Offer a net price so you know exactly what you’ll walk away with
You won’t need to:
- Pay agent fees
- Make repairs
- Wait for inspections
- Handle buyer financing delays
It’s a fast, hassle-free process that lets you keep more money in your pocket.
Benefits of Selling Your House to a Cash Buyer
If your goal is to avoid massive closing costs, unexpected expenses, and delays, selling to a cash home buyer is the smart move.
Why Homeowners Choose Cash Buyers:
✅ No agent commissions
✅ No repairs, staging, or cleaning
✅ No showings or open houses
✅ No closing costs (buyer pays them)
✅ No financing contingencies
✅ Fast closing—often in 7 to 14 days
Whether your home is outdated, inherited, in probate, or facing foreclosure, cash buyers can simplify the process and put cash in your hands faster.
Final Thoughts: Closing Costs Don’t Have to Eat Your Equity
When selling a house, many homeowners are caught off guard by how much they lose to closing costs, agent fees, and buyer credits. On a $400,000 home, that can easily be $30,000 or more—money that could’ve gone toward your next home, retirement, or debt payoff.
If you’re looking to maximize your return and minimize the headache, working with a trusted cash home buyer like PineCone Properties can save you time, money, and stress.
We buy houses in any condition, pay all closing costs, and give you a fair cash offer—no repairs, no fees, no drama.
📞 Call us today at (360) 572-6669 or visit our Contact Us page to request your no-obligation offer.
You could have cash in your hands—and your house sold—in as little as two weeks.