Closing Costs Explained: Who Pays What at the Closing Table?

Closing the deal on a home is an adrenaline rush, but before you get the keys (or the check), there is one final hurdle: closing costs.

At The Saladino Sells Team, we believe transparency is the key to a stress-free move. Closing costs typically range from 2% to 5% of the home’s purchase price, and they are split between the buyer and the seller. Here is exactly who pays what when the deal crosses the finish line.

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1. What the Buyer Typically Pays

As a buyer, most of your closing costs are associated with your mortgage and the "due diligence" of ensuring the property is a sound investment.

• Loan Origination Fees: What the lender charges to process your application.
  
  
• Home Appraisal: To ensure the home’s value matches the loan amount.
  
  
• Home Inspection: A crucial step to verify the property's condition.
  
  
• Title Insurance (Lender’s Policy): Protects the bank's interest in the property.
  
  
• Escrow Prepaids: Initial deposits for homeowners insurance and property taxes.
  
  
• Recording Fees: Paid to the local government to register the new deed.
  
  

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2. What the Seller Typically Pays

While sellers usually have fewer individual line items, their costs are often higher because they traditionally cover the commissions for both agents.

• Real Estate Commissions: The fee paid to both the listing and buying agents.
  
  
• Title Insurance (Owner’s Policy): Usually paid by the seller to protect the buyer’s ownership rights.
  
  
• Transfer Taxes: State or local taxes triggered by the transfer of the title.
  
  
• Property Tax Prorations: Any unpaid property taxes up to the date of the sale.
  
  
• HOA Transfer Fees: If the home is in a managed community, the seller often pays to "transfer" the membership.
  
  

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The "Who Pays What" Breakdown

Fee Type	Typically Paid By	Why?
Appraisal	Buyer	Required by the lender for mortgage approval.
Agent Commission	Seller	Part of the marketing and sale agreement.
Title Search	Buyer/Seller	Negotiable, but ensures a "clean" title.
Credit Report	Buyer	Needed for loan qualification.
Prorated Taxes	Seller	Covers the days the seller lived in the home.

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Can You Negotiate Closing Costs?

Yes! In a "Buyer’s Market," you might ask for a Seller Concession, where the seller agrees to pay a portion of the buyer’s closing costs to help close the deal. Conversely, in a "Seller’s Market," buyers may offer to cover fees usually paid by the seller to make their offer more competitive.

Pro Tip: Always review your Closing Disclosure (CD) at least three days before closing. This document outlines every penny being spent, so there are no surprises when you arrive to sign.

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Ready to Close with Confidence?

The Saladino Sells Team is here to guide you through every line item of your contract. Whether you’re buying your first home or selling a luxury estate, we ensure you’re prepared for the finish line.

Connect with the Saladino Sells Team Today!