Atlanta Real Estate, McDonough Real Estate, Stockbridge Real Estate
As a Seller, the listing agent (the Realtor you hire to sell your home) charges a fee that is based on the sale price of the home. The Realtor pays for all advertising and marketing associated with the sale. This fee also covers the fee for the co-op agent in the transaction (the agent that represents the Buyer). The Realtor's fee, or "commission", is paid out of the Seller's funds at closing. The Seller may also be responsible for making repairs to the property, either before it goes on the market, or during the inspection period if it is requested by the Buyer. (In order to avoid having to make costly repairs, it is very important to keep your home well maintained througout the year). The seller is also required to have a termite letter in the property explaining the condition of the property as it relates to termite infestation. Another letter will have to be drafted for the closing. Depending on the termite company used, it can cost $45-75 and can usually be paid out of the proceeds at closing. In a competitive market, Sellers may also wish to offer incentives to the Buyer in order to make their home more "attracitve" in the marketplace. The items could include a Home Warranty or offering to pay some association dues up front for the Buyer. At the closing, the Seller will be required to pay off the balance of their mortgage, as well as some attorney's fees, the state transfer tax, and recording fees.
As a Buyer, there is no fee for using a Buyer's Agent since the Seller of the home you purchase will be paying the Realtor fees. However, there are some minor costs associated with purchasing a home. At the initial offer stage, the Buyer will have to put up "Earnest Money", or Good Faith money. This is to show that you are serious about buying the home. It is typically about 1-2% of the offer price of the home. The check is deposited into the Broker's trust account and will remain there until closing. The Buyer will get that money back at the closing in the form of a credit towards whatever costs he/she is paying.
After your offer has been accepted, you will go into the inspection period. This is when you hire a Home Inspector to carefully examine all aspects of the home and write a report of the findings. Items needing repair can be negotiated with the Seller. Most inspectors charge by the size of the home since larger homes will take more time to inspect. For an average 4 bedroom home, expect to pay around $300, depending on the inspector you choose. Your Buyer's Agent will have a reccomended and trusted professional for you to hire.
Before the closing, you will need to purchase Homeowner's Insurance (Hazard Insurance). This is required in order for you to purchase a home. For an average 4 bedroom house, you can expect to pay around $800 per year, depending on the company and type of coverage. Six months worth of your insurance premiums will usually be placed in an "escrow" account at the closing. Your lender will pay this to the insurance company on your behalf out of this account.
There are also costs associated with applying for, and obtaining a loan. The lender's fees will usually add up to be around $1200 depending on the lender you choose and the type of loan you get. These costs, along with attorney's fees, are considered "closing costs" and can be estimated by this simple formula: 1.5% x Loan Amount + $1600. (This is only to be used as a guide. Please consult your lender for the actual costs). These costs are required to be paid in cash at the closing table, unless your lender allows you to roll them into your financing. Closing costs are almost always negotiated in the initial offer to purchase, so the Seller may agree to pay some or all of these costs for you!
Other minor costs when moving to a new home may include any moving company fees or any new furniture or home items you need to purchase. Before deciding to purchase a home, carefully examine your lifestyle and make sure it's the right time to make the commitment. When it is, you'll be glad you did!
