Breaking Down The Closing Costs!

As we see the market here along the beaches of Tampa Bay stabilize and begin the slow road to recovery, one thing many Buyers and Sellers are looking at is what to expect at CLOSING. Here are a few things to look for:

In Florida, unlike some other states, we normally use a Title Agency to close the sale of a property. There job is to ensure proper transfer of title and provide Title Insurance for the Buyer. The Seller normally pays for this Title Insurance and it averages around a half a percent of the sales price. For example, a property that sells for $350,000 would see a charge for approximately $1750 for Title Insurance. The Title Agency will charge a nominal fee for handling this process.

The actual date of the closing impacts payments of such things as Property Taxes and Association Dues or Maintenance Fees by way of pro-rating. The property taxes are estimated for the year by the county Property Appraisor. The Seller is responsible for his portion up to the day of closing and the Buyer is responsible for the portion from the closing date to the end of the year. Fees that are paid monthly are similarly pro-rated as of the closing date for that month. In some cases, the closing agent will collect the next month's fee from the Buyer for simple transition.

If the Buyer is financing the purchase, his lender should provide a Good Faith Estimate of any fees or up front money required depending on the rate approved. The Buyer should be totally aware of what to expect prior to closing.
Use our Mortgage Calculator to view current rates.

Documentary stamp taxes and intangible taxes are collected on the Deed and the Note. The Seller normally pays for stamps on the deed, and the Buyer pays for stamps on the note. A quick way to estimate what these numbers will be is this: On the Deed Tax, paid by the Seller, take the sales price divided by 100, then multiplied by $.70 In the example above, $350,000/100 = 3500 x $.70 = $2450. On the Note Stamps on the Mortgage Amount, paid by the Buyer, take the mortgage amount divided by 100, then multiplied by $.35 In the same example, if the Buyer is financing 80% of the purchase, the mortgage amount would be $280,000. $280,000/100 = 2800 x $.35 = $980.

This should help when estimating your costs, but know that in doing a transaction with The Purtee Team that we are looking carefully at each piece of the Closing State to protect your best interest!