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Old 06-26-2016, 02:45 AM
 
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I'm in Baltimore, MD. Let's say a house was listed for $30,000. I'm paying cash. How much can I expect to pay altogether with various fees I never ever heard of? I'm actually trying to haggle down the price (is this possible?). The location isn't "hot" so I won't have any competitions trying to jack up that price. Is it realistic to haggle that price down to $15,000? I bet it will get countered with $20,000 or so. I just want the price a bit lower and I want to be ready whatever fees I never heard of in case I need more cash for it. Do realtors get a cut based on how much the house was sold for? Which I think they'd want to sell the house for as high as possible, not exactly looking for the home buyers best interest (i.e. lower price). I have mixed info. regarding this because I knew someone who sold a few hundred thousand dollar home who got $30,000 in commission (in a hot market). Wouldn't this mean that the more expensive the realtor can sell the house, the more in commission they can get? So would a realtor look down on me haggling down the $30,000 asking price to half (which I know will be countered with a price upwards that)? Since I'm paying in cash, how much can I expect to pay in extra fees for a $30,000 house?
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Old 06-26-2016, 05:56 AM
 
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Quote:
Originally Posted by bomocrabcakes View Post
Since I'm paying in cash, how much can I expect to pay in extra fees for a $30,000 house?
If you're paying cash there are few extra significant fees. Normally, you'll pay a closing fee to the title company (if you use one--and you should unless you pay an attorney; around here that would be about $150 - $300) and there may be some small recording fees. Otherwise, your biggest expense may be prorated taxes if the property taxes are paid in advance in Maryland. (They are in Michigan; not sure about Maryland.)

Other expenses may include a title insurance policy and transfer taxes. In Michigan, that's not much of a concern to a Buyer since title insurance and transfer taxes are usually paid by the Seller. Find out what is customary in your area.

As for trying to get a lower price, it all depends on the property and the local market--and the willingness of the Seller. If the property is realistically priced at $30,000, don't expect to receive that much of a discount. Offering half-price, however, will likely get your offer placed in the circular file or simply ignored. Low ball offers tend to offend people and make them think that your not serious. Don't expect a counter offer in that situation, although it could happen. I suppose anything is possible. Again, it really depends on the property and the Seller's motivation. Don't worry about the impact upon the agent's commission. A sale at any price is better than no sale...but they also have to look out for the Seller's best interest so low-ball offers usually get dismissed rather quickly.
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Old 06-26-2016, 06:43 AM
 
Location: MID ATLANTIC
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It also depends on your expectations on other terms. If the cash price is discounted from market value, don't expect a laundry list of contingencies-. Chances are the seller is thinking cash = quick close.
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Old 06-26-2016, 08:40 AM
 
Location: North Idaho
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I suggest you call your local escrow company or whoever it is who handles real estate sales in that area.

Off the top of my head, you'll have prorated taxes, which might be high, depending upon tax rates in your area. You'll have a couple hundred dollars of title insurance. There will be recording fees and fees for the escrow company. There might be tax stamps for that area.
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Old 06-26-2016, 10:16 AM
 
Location: Just south of Denver since 1989
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Prorated taxes would be a credit to the Buyer.

Other Buyer paid fee from closing:
recording fees to the county
A closing fee to title or escrow company
state doc fee or stamp tax

$50,000 seems very low. Is the property habitable or is it a scrape? What is the land value?

I wouldn't think that a seller would be all that interested in 50% off sale. Who knows what the Seller will accept until you make a written offer.
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Old 06-26-2016, 03:37 PM
 
6,691 posts, read 8,030,951 times
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Quote:
Originally Posted by 2bindenver View Post
Prorated taxes would be a credit to the Buyer.
Not everywhere. It depends upon how the property taxes are paid--in advance or in arrears. In Michigan, Buyers are almost always charged with prorated taxes. In one of the last transactions I handled, the prorated taxes amounted to over $8,000. Of course, that wasn't on a $30K house.
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Old 06-26-2016, 09:24 PM
 
Location: Michigan
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22 years ago I bought a house in mid-Michigan listed at $35,000 for $20,000 cash, no contingencies. This was for a straight rehab and resell. My very first for that purpose, where we didn't intend on living in it.


However, it was an estate, had been listed for TWO YEARS at that point with no offers, and was in terrible condition. Not one thing had been done to that house since the early 1950's. Except to add 6 layers of roofing, total! A newer house would have collapsed with all that weight. There wasn't one square inch of roofing that didn't have nails through it.


I spent 2 years rehabbing that particular house, also had to spend the first Summer jacking it up (center beam and floor joists were toenailed into each other!, posts rotted, and couldn't keep it up anymore) and I learned that a low price isn't always a good thing. Yes, I made a bundle on resale, but two years of my life wasn't worth it.


Be prepared for a lot of work, and perhaps a lot of money just getting it back up to code.


Rehabbing is gambling, and you have to be very careful to not become what is known as a "don't want-er"
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Old 06-26-2016, 10:10 PM
 
6,691 posts, read 8,030,951 times
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Quote:
Originally Posted by MikeBear View Post
Not one thing had been done to that house since the early 1950's. Except to add 6 layers of roofing, total!
That has to be a record! Three...very rarely four...but six? Wow.
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Old 06-26-2016, 11:46 PM
 
Location: Michigan
2,247 posts, read 1,466,162 times
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Quote:
Originally Posted by jackmichigan View Post
That has to be a record! Three...very rarely four...but six? Wow.
One of the layers was roll roofing! I almost needed a bulldozer up there to scrape it all off. I think the whole house sprang up at least a few inches after it was all scraped off.


My son at the time was 8 years old. I gave him a big magnet, and paid him 1 cent per roofing nail recovered from the ground after we re-roofed, lol.


Best $20~ I ever spent.
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Old 06-27-2016, 06:39 AM
 
5,888 posts, read 7,744,425 times
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Don't know much about the fees part but the price you can get it for is anybody's guess.

How long has it been listed for? Why do you assume there won't be any other competition? If you are interested, it's certainly possible other people are as well. If it is liveable and/or not surrounded by boarded-up houses then there likely is other interest, and at that price point if other people are interested they might be trying to pay cash as well.

Last edited by GoPhils; 06-27-2016 at 07:05 AM..
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