[giddyup]

Hello, I'm from chicago area, leaving tonite for Ocala to buy a house (Lord willing)... I have a question about closing costs... how much are they?

I've asked this question in the past from various people and I never felt like I got a straight answer. I see a lot of houses for sale that say "seller will pay $6000 of buyers closing costs"... are they really over 6 grand?

When we originally bought our old house (sold already) I don't remember that much in closing costs, maybe a couple thousand but that was it.

Is there something different in florida that drives up closing costs?

Thanks in advance for the help

[jamesdsimpson]

Beware!

If they promise to pay 6k towards the closing costs, I'll bet they will do so only if you use their lender. They will then jack up the closing costs by 6k.
They can charge you for just about anything just as long as the disclose it to you.

It happened to my daughter.

[giddyup]

Thanks for your response, how can a seller force you to use their lender? (I understand how a builder could do that... but not any old seller)

What all is involved in the closing costs that costs a LOT of money? In illinois taxes are paid in arears, is Florida the same or am I going to have to pay taxes up front?

Thank you.

[Prichard]

Believe it or not, your Contract will determine precisely what your closing costs are. There is no way for anyone to tell you with any degree of accuracy or honesty, what your closing costs should be without reviewing your contract. If you have a "Builder's" type contract, your closing costs will likely be quite high. If you did the contract on one of the standard form Florida contracts, then they shouldn't be as bad.

Closing costs are a factor of the following:
- purchase price
- your mortgage / lending costs as shown on the good faith estimate (including appraisal and a bunch of junk fees)
- survey cost
- possibly inspections
- closing company's fee and other add on junk fees (negotiated by seller and buyer, if done right)
- title insurance - determined by contract as to who pays for this, search fee, review fee, etc.
- Taxes on Mortgage and Note (.0055 x loan amount)
- tax prorations - HOA dues/prorations
- agreed upon credits
- real estate commission - per agreement; real estate junk fees - per agreement
- anything else your contract says you have to pay.

I don't mean to sound harsh, but realtors (not all, but most), builders, closing companies, and lenders are professionals at hiding the true costs associated with buying a house. These things are set in stone at the time you sign that contract. There is no way anyone who is not totally familiar with these things can figure this stuff out for themselves. Most people are honest, but out-of-staters can be easy targets for people who are "marginally" honest, or out-right disshonest.

A very rough ball-park estimate of closing costs on a $300,000 pre-owned house with $290,000 mortgage would be in the range of $6,000. However, if you are dealing with a builder, you might get screwed for another $6,000. Hope that helps, be careful, and good luck.

[RedWingsFan]

In your offer it's pretty standard that you ask the seller to pay all or half of your closing costs. It all depends on who you go with but if you buy a house somewhere around $250k it's going to be arond $6k for the closing costs. Right now it's a buyers market. In you offer be sure to state that they need to pay all your closing costs. Then they can always come back and offer to pay half of it. There's no way you should get stuck paying all closing costs, if you did in this market then you are getting a bad deal.

[Prichard]

In your offer it's pretty standard that you ask the seller to pay all or half of your closing costs.

No, not in Central Florida. Standard is where Buyer pays all loan related costs. Seller pays Deed Stamps and Owner's title and related charges. Seller pays Broker's commission. No one around here on re-sales pays 1/2 Buyer's costs. Nor do they just split all costs 50/50. They are typically broken out by line item as to who pays what.

[RedWingsFan]

Originally Posted by Prichard

No, not in Central Florida. Standard is where Buyer pays all loan related costs. Seller pays Deed Stamps and Owner's title and related charges. Seller pays Broker's commission. No one around here on re-sales pays 1/2 Buyer's costs. Nor do they just split all costs 50/50. They are typically broken out by line item as to who pays what.

Not true. In December (in Central Florida) we put an offer on a house and said that as part of the offer the seller had to pay all our closing costs. It was accepted, they took the offer with that stipulation! It's a buyer's market and all you have to do is put that offer out there asking for them to pay all or half of your closing costs and if they really want to sell in this slow market then they will bite. If they won't budge and help pay closing costs then give the offer to one of their neighbors, they'll like take it. If people want out of their house they will take it and pay your closing costs. In every other state I've lived in it was the norm and it went down the same where here in Central Florida.

[Prichard]

RedWingsFan, I'm not saying that you can't structure a contract in the way you did, you certainly can. And, there's nothing wrong with that.

But, it is not the standard in Central Florida. Even Central Florida's "standard" when it comes to who pays what closing costs differs from that of South Florida.

As between states, these things differ drastically. You can't compare what we do in Florida with what is done in other states. The Northeasten states do things much different than we do. Even Georgia and North Carolina are different than Florida.

Still, with that said, you can do a contract anyway you want. There's nothing that says otherwise. So, "standard" is a term that needs to be used somewhat loosely.

P.S. I shouldn't have said "no one around here does it that way..."

[RedWingsFan]

Still, my point is that I'm trying to tell him how to save money, while you are acting like no- just go ahead and pay the closing costs. Okay, would it be better for you if I said "it's normal" in other places for the seller to pay closing costs instead of "standard." I think the word standard is bothering you.

giddyup - save yourself some money and in the offer require them to pay all of your closing costs. It can save you thousands. People in states across the country understand that and like it.

[giddyup]

Prichard, RedWingsFan, thank you so much for the information; I will definately keep these things in mind, in fact i'm printing this and taking it with me.

Have a great weekend, I'm off to your state