Understanding closing costs.
Closing costs are the expenses paid at the closing of a real estate transaction in addition to the purchase price. These costs vary based on the county, loan type, lender, contract terms, and the specific property being purchased.
Buyer closing costs
Buyer closing costs often include:
- Title fee
- Title insurance policy (buyer typically pays in Broward County)
- Survey costs
- Recording fees
- Transaction fee
- Escrow account setup
- Lender fees (origination, appraisal, underwriting fees, etc.)
- Prorated association fees (buyer's portion of current month's dues already paid by seller)
- Prepaids (upfront payments for property taxes and homeowners insurance)
Seller closing costs
Seller closing costs often include:
- Real estate commissions
- Title fee
- Title insurance policy (seller typically pays in Palm Beach County)
- Documentary stamp taxes on the deed
- Municipal lien search
- Title search
- Transaction fee
- HOA or condo association estoppel fees
- Mortgage payoff
- Prorated property taxes (for the portion of the year they owned the property)
- Seller credits towards the buyer's closing costs
A few details that often catch people off guard.
The Property Tax Credit
Since Florida property taxes are paid in arrears, the seller usually gives the buyer a credit for the portion of the year the seller owned the property. The buyer then becomes responsible for the full tax bill when it comes due.
Seller Credits & Loan Guidelines
Seller credits must comply with the buyer's loan program guidelines. Different loan types and down payment amounts have different limits on how much the seller can contribute.
Who Chooses the Title Company?
In Broward County, it is customary for the buyer to choose the title company and pay for the title insurance policy. In Palm Beach County, it is customary for the seller to choose the title company and pay for the title insurance policy. These are local customs, not absolute rules — the buyer and seller can negotiate different terms in the contract.
Want a closing cost estimate for your transaction?
Every deal is different. Reach out and we'll walk you through what to expect based on your specific situation.
Get In Touch