What closing costs does a seller pay?
The costs that come out of a home seller's proceeds at closing, what each one is for, and roughly how large it is.
When you sell a home, the buyer's money does not come straight to you. The closing agent first pays everyone who is owed something from the sale, and you get what is left. On a typical sale those deductions add up to somewhere between 6% and 10% of the price, before your mortgage is paid off.
Agent commission
This is usually the largest cost. Commission is negotiable and is set in your listing agreement. Since August 2024, when new rules from the National Association of Realtors settlement took effect, sellers are no longer assumed to pay the buyer's agent, although many still offer to. Ask your agent which fees your listing covers, then put that percentage in the calculator.
Transfer tax
Most states tax the transfer of a home, and the seller usually pays. The size varies a great deal. Fifteen states charge nothing at the state level, most of the rest charge well under 1%, and a few places such as Delaware, Philadelphia and Pittsburgh charge 4% or more in total. See transfer tax by state for your rate.
Title, escrow and attorney fees
Someone has to run the closing: a title company, an escrow company or an attorney, depending on the state. Sellers commonly pay for part of that service, and in many areas the seller also buys the owner's title insurance policy for the buyer. Together these often come to around 0.5% to 1% of the price.
Your mortgage payoff
The balance of your loan is paid from the sale. Your payoff is a little higher than the balance on your last statement because it includes interest up to the day of closing. Your lender will give you an exact payoff figure on request.
Prorated property tax and HOA dues
You owe property tax and any association dues up to the closing date. If you have already paid for a period that runs past closing, the buyer pays you back, so this line can go in your favor.
Repairs and credits to the buyer
After an inspection, buyers often ask for repairs or a credit toward their own closing costs. Nothing obliges you to agree, but when you do, a credit comes off your proceeds.
What is usually not a closing cost
Capital gains tax is settled on your income tax return, not at the closing table. Moving costs and any work you do before listing are also outside the closing statement, though they are part of what the sale costs you.
Run your own numbers in the calculator, or look up transfer tax by state.
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