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I hope it goes without saying that this is relevant to homes in Lake Zurich, Hawthorn Woods, Kildeer, Long Grove and the Villages of Barrington area. For the most part they are the same in Chicago although other suburbs and city areas may have an additional tax. As you learn the costs and want a quote for your home, give us a call for a listing appointment at 847-363-3686.
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Closing Costs Guide
If you would like to know exactly how much it will cost when selling a house in Lake Zurich, this guide should help. Just know we cannot be 100% accurate and this can not be the true and actual cost but it gives you a pretty good idea. We also do not quote real estate taxes as the costs of selling real estate because they are not costs. You are responsible for real estate taxes to the date of sale in IL, and in Lake Zurich we just happen to pay them in arrears. You may also be asked to contribute towards the buyer’s fees.
In Lake Zurich, selling a house is not as simple as sticking a sign in the ground, choosing a buyer, receiving payment and handing the keys over. You either must be an expert at selling real estate or hire one to help you. There are numerous costs associated with getting your home sold that you should be aware of.
Please see the representative list below, along with examples for average costs of selling a home in Lake Zurich. Consult with your broker and attorney, as costs will be specific to your transaction.
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How Much is the Real Estate Agent’s Commision Going to Cost?
Real estate commission is negotiable. That’s the law. It will vary by company, broker, service plan, experience etc. The brokerage fee includes marketing your home, MLS exposure, other online website exposure including those big names you know, Zillow and Trulia, Realtor and Homes, property website, social media exposure, search engine exposure. It covers guidance through all the paperwork, strategy on pricing and offer presentation through acceptance, monitoring the transaction all the way to closing. We are there to help with any hiccups and be the go to contact for the buyers agent, attorneys, lenders and anyone else involved.
For the purposes of this example we will use the average home price sale amount for Lake Zurich of $330,000 over the last 6 months. If the commission to sell this home were 6% that would be a total of $19,800. In Lake Zurich, typically the seller pays the entire commission to both the listing agent side and the buyers agent side. That means the brokerages get paid first and they give their brokers a cut of that. So your commission payment ends up in 4 pockets out of which each pays their own taxes, marketing costs and so on.
You should know that all marketing plans are not created equal and you are best advised to find out and understand exactly what a broker will do, how often their communication will be and how the commission is split and paid. I strongly advise never to look at a discounted amount if your agent is going to bring your buyer. Even though that rarely happens, known as dual agency, when you fully understand it, you would never choose it. While legal in Illinois and promoted by some Lake Zurich agents, invariable it’s not good for you or your bottom line. Ask me why!
- Commission is the largest line item for Lake Zurich property sellers.
Payment of Closing Costs: Your home is not sold until the title and funds pass at the closing table. Most of the seller’s closing costs are paid at this time. We’ve already talked about real estate commission, at the closing table, which in Lake Zurich will usually be at a title company or sometimes an attorney office, and the sales commission is paid from the sale proceeds at this time.
Did you realize that most Realtors work all the way to closing without getting a penny of compensation from anyone. Some sales don’t close and we don’t get paid.
Staging Fees: If you have a vacant home you may choose to have it staged. The cost can be $2,000, more or less, depending on how much you want done by the stager. For lived in homes there’s nothing wrong with saving those funds for a vacation and doing it yourself. But please seek the advice of a Realtor with staging experience, or years of experience in the business. Our service is free and we know what works and what does not. List with us and we’ll spend time making suggestions, but we won’t offer it if you want to list with someone else. This is not a closing cost but a marketing expense and is not required, it’s optional.
Closing Costs Summary
Here’s Our Example: Home sells for $330,000. For our example you agree to a 6% commission with 3.5% to the listing agent’s brokerage for their comprehensive marketing system and negotiations and 2.5% to the buyer broker who procures the buyer. Your total expense for the commissions would be $19,800 regardless of how it is split. (Sellers must agree to these splits as part of a listing agreement.)
Title Insurance Fee: This is the next biggest line item and is based on your sale price. For our example at the time of writing that fee is going to be $1,970. If your buyer is getting a mortgage he has to pay $500 plus $180 for an environmental protection lien.
Title Company Fee: The title company is transacting the sale. Because in Lake Zurich IL our transactions close at the table, (unlike escrow closings which do not), we have to pay them for the service of actually closing your sale. Each title company has it’s own set of charge amounts. A fair estimate is somewhere between $1,000 and $3,000 depending on price and complexity of the transfer.
State & County Transfer Tax: $330.00 and $165.00 respectively. 1% and 1/2% respectively.
Title Commitment Update Search: This is done to be sure title is free to transfer at the time of closing. Sellers Fee $125.00. You might think this a silly practice but to gain title insurance it must be done. The title insurance is your safety net. So the policy issuer, which is usually Alta, want to be sure no-one filed any deeds between the start of your purchase and the closing date.
Attorney Fee: These can range wildly depending on how easy or difficult your sale became. Most attorneys will quote a flat fee of around $500 with a caution to the amount of hours that will be spent before adding an hourly rate. Complex transactions can be much higher.
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What Else Should a Seller Budget For?
Repairs from a home inspection can be the biggest surprise of all when selling property. After all, we all think our homes are perfect and nothing will come up. I guarantee you something will. So be prepared to make repairs or if allowed by the buyers lender and requested, a credit for buyer instead. The most common items on an inspection that need fixing are electrical and plumbing issues. Both can be costly depending on what’s needed. A hot water tank if on it’s last legs can set you back a quick $1,500! A small amount of re-amping a fuse or two can be a quick $500.
In the event of a failing well or septic the cost is going to be in the thousands. Well water treatments are not as expensive and are needed if the water tests come back with bacteria. All a few hundred $$.
Those Darn Real Estate Taxes
Remember at the beginning I said that real estate taxes are not a selling cost? Well they are not. But you still have to pay them. If you escrow your taxes monthly with a mortgage payment, you should have it covered. But if you pay your taxes when the bill comes, at closing that bill comes due right now. Today is February 2nd. The taxes for 2016 are paid in June and September for Lake Zurich. If you were closing today, at the closing table you’ve got to cough up all of 2016 taxes and also taxes for the first 33 days of 2017. We also usually tack on about 5% to allow for any increases as the bills are not yet known.
No matter where you are going and what you are moving to, unless you are already moved, you’ve got get your belongs out before closing. Moving companies, boxes, van hire, however you choose to move, remember the funds for it.
Choose an Agent to help you with the process
With the help of an Lake Zurich Real Estate expert such as Corinne Guest, you are more likely to sell your house quickly and maximize your value. You need someone who knows how to sell a Lake Zurich house and is knows the current market situation.
Call Corinne at 847-363-3686
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