What Sellers Can Expect at Closing

As part of the purchase contract on the sale of your home, you and your buyer will agree to a closing date. Your home's closing day is important because it is the day you transfer property to your home buyer, pay any mortgages in full, and receive the proceeds from the sale of your home.

Here are tips to help you know what to expect on closing day and how to avoid pitfalls.

The Seller's Closing Costs

Preparing to sell your house is a learning process. Perhaps one of the more surprising aspects of the adventure may be the costs incurred as the home seller. Going into a home sale, many sellers expect to be leaving the table with a profit. Of course, if you and your real estate agent negotiated a fair sales price, you can easily come out on top. Be prepared to spend some of your profits during closing. Prepare for approximately 6 to 10 percent of profits to go toward closing costs. If your home sold with little profit, you may be required to bring money to the table.

Typical seller's closing costs include:

• The broker or agent's commission. Though commissions are often negotiated and can vary from market to market, the broker collects 6 percent of the home's cost on average.
• Any remaining debt on the home. Your home's sale price should cover the existing mortgage, as well as interest. However, when dealing with little equity, the seller must pay off the mortgage out of pocket.
• Any liens or judgments against the home.
• Recording fees/transfer taxes. Your state and local government may charge fees to transfer the title from one owner to another.
• Title insurance fees.
• Attorney's fees. Typically, a seller must pay the fees associated with his personal attorney. However, in some markets, sellers do not commonly use their own attorney.
• Repairs or a credit for repairs as negotiated in your sales contract.
• Prorated property taxes
• Homeowner's Association dues owed up until the closing date.

The Seller's To-Do List

In order to sell your house, the closing period may include tasks you need to accomplish prior to your closing. After escrow opens, you and the buyer will come to agreements in regards to financing and inspections. Your real estate agents will then remove any contingencies from the sales contract. The escrow's job is to ensure all the paperwork is properly prepared and processed, including the buyer's loan documents, property tax balance, balances related to your mortgage payoff and a preliminary title report. During this period, follow these simple tips to ensure closing continues smoothly:

• Negotiate and complete any necessary repairs.
• Keep the home in excellent condition.
• Continue your homeowner's insurance policy until the closing paperwork is filed.
• Prepare to move.
• Prepare to end or transfer utility service.

The final step to selling your house is to review the HUD-1 document and sign all necessary paperwork. The HUD-1 document, prepared by escrow, outlines all monies coming in and being paid on closing day.

Celebrating the Sale

When selling your home, think of the process from listing to closing as a business transaction. Most times leaving a home, even for greener pastures, is bittersweet. Schedule the closing when you can properly celebrate with your family.

Transfer your home from "for sale" to "sold" in the most efficient manner with the help of a skilled real estate agent. RE/MAX DFW Associates' team of real estate agents are standing by to help you list your home, find potential home buyers and negotiate a sale with RE/MAX DFW Associates. Contact us today!