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Buyer-side and seller-side closing costs

Florida generally has low taxes and affordable real estate. However, there are some expenses that might surprise unprepared buyers or sellers during the transaction process.

Closing costs are a classic example. One should typically be able to predict closing costs with a high level of accuracy when all of the necessary information is at hand. However, few people choose to do so.

Buyer’s costs

Buyers’ and sellers’ costs differ depending on the transaction and the location. In Lee County, the buying side would typically pay for:

  • Form 9 title endorsement
  • Documentary stamp tax and intangible tax on note
  • Recording fees
  • Lender’s title insurance
  • Alta title endorsements

Most of these have to do with securing and finalizing the transaction. This is a very important aspect of making sure that a real estate deal is legitimate. Disputes concerning ownership of real property are typically expensive and complicated.

Seller’s costs

Sellers also usually assume some of the closing costs. For example, the seller would pay the documentary stamp tax on deed (as opposed to the tax on note). Sellers also typically pay for the title search and the owner’s title insurance policy.

There are many ways that these costs could shift. For example, an adverse home inspection could persuade a seller to assume more of the buyer’s costs. The parties to the deal would work out a compromise in this type of situation.

Finally, the buyer and seller may share some costs. They typically prorate taxes and assessments, paying only for the part of the year each party had ownership of the property. Both sides also usually pay closing fees.

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