How Much Are Seller Closing Costs in Florida?

Selling a home involves various expenses beyond the real estate commission. These costs, known as seller closing costs, can significantly impact the net proceeds from a sale. Understanding what these expenses entail is important for Florida homeowners, and this article outlines the typical closing costs sellers can expect to pay.

Common Seller Closing Costs in Florida

Real estate commissions typically represent the largest expense for a seller. This fee covers the services of both the seller’s real estate agent and the buyer’s agent, compensating them for marketing the property, negotiating the sale, and facilitating the transaction. The total commission is generally a percentage of the home’s final sale price.

Another cost often borne by the seller in Florida is the owner’s title insurance policy. This policy protects the buyer from potential financial losses arising from defects in the property’s title, such as undisclosed heirs, liens, or errors in public records. While negotiable, it is often covered by the seller.

Documentary stamp taxes are state-level taxes imposed on the transfer of real property and on obligations secured by mortgages. The tax on deeds is based on the property’s total consideration. A separate documentary stamp tax applies to mortgages or other written obligations to pay money recorded in the state.

Sellers also typically account for prorated property taxes and homeowners’ association (HOA) or condominium association (COA) dues. These expenses are divided between the buyer and seller based on the closing date. This ensures each party pays for the period they owned the property during the current tax or assessment cycle.

If the property is part of an HOA or COA, a fee for an estoppel certificate is common. This document provides a snapshot of the seller’s financial standing with the association, detailing any outstanding fees, special assessments, or violations.

Recording fees are charges levied by the county clerk’s office for officially recording the new deed and other necessary documents, such as mortgage satisfactions, in the public records. These fees ensure the legal transfer of ownership is properly documented.

A settlement or closing fee is paid to the closing agent or title company that facilitates the entire transaction. This fee covers the administrative services involved in preparing closing documents, conducting the closing, and disbursing funds to all parties. While not always required, sellers may also incur attorney fees if they opt for legal counsel to review contracts or address specific issues during the sale process.

Estimating Your Seller Closing Costs

Estimating seller closing costs involves calculating percentages and fixed fees for the various expenses. Real estate commissions, often the largest component, typically range from 5% to 6% of the home’s sale price, covering both the listing and buyer’s agents. For example, on a $400,000 home, this could amount to $20,000 to $24,000.

Owner’s title insurance is calculated based on the property’s value using state-regulated rates. For instance, the rate is $5.75 per $1,000 of value for the first $100,000, and $5 per $1,000 for amounts over $100,000. A $400,000 home would incur approximately $2,075 for title insurance.

Documentary stamp taxes on the deed are generally assessed at a rate of $0.70 per $100 of the sale price in most counties. For a $400,000 home, this tax would be $2,800. If the seller is responsible for satisfying a mortgage, a documentary stamp tax of $0.35 per $100 of the mortgage amount applies to the note.

HOA or COA estoppel certificate fees are regulated, with a standard charge of up to $299 for preparation. Settlement or closing fees typically range from $300 to $650, depending on the title company or closing agent.

Recording fees are usually modest. When considering all these potential costs, sellers can generally estimate their total closing costs, including real estate commissions, to be between 6% and 10% of the sale price. Excluding commissions, these costs might range from 1% to 3% of the sale price. Actual costs can vary based on the specific property’s value, the county where the property is located, and negotiated terms in the sales contract.

Understanding the Closing Disclosure

The Closing Disclosure (CD) is a standardized five-page form that provides a comprehensive summary of all financial details of a real estate transaction. It outlines the final terms of the loan (if applicable), the actual closing costs, and how funds are distributed between the buyer and seller.

Sellers typically receive a copy of the Closing Disclosure several days before the scheduled closing date. This allows sufficient time to review all figures and compare them against earlier estimates and the terms agreed upon in the purchase contract. Sellers should focus on sections detailing their credits and charges, often labeled as “Seller’s Transaction” or “Summary of Seller’s Transaction.”

Reviewing the Closing Disclosure involves checking the accuracy of all entries. This includes verifying real estate commissions, title insurance premiums, documentary stamp taxes, and any prorated amounts for property taxes or association dues. Confirm that any negotiated credits or contributions are correctly reflected.

Discrepancies should be immediately brought to the attention of the closing agent or real estate professional. Ensuring the accuracy of the Closing Disclosure is important to confirm that the net proceeds from the sale align with expectations and that all financial obligations are correctly accounted for.