Closing Costs for Overseas Sellers
When selling a home or a condo in the United States, there are several costs that must be taken into consideration. By being aware of these expenses, known as closing costs, you will be better prepared to calculate these expenses when you put your property on the market
One of the expenses you can expect to pay as part of your closing cost is a brokerage commission fee. The amount of this fee will vary depending upon where the property is located and the condition of that particular market. If the property is located in a seller’s market, the brokerage commission fee will likely be slightly less than it would be if you were selling in a seller’s market. Generally speaking, however, you can expect to pay around 6 percent of the purchase price toward your brokerage commission fee.
Paying a broker to assist with the sale of your property offers many benefits. Not only can a broker help to maximize the value of the property, but a broker can also help to negotiate the price. A broker will also be able to better advertise the property and locate potential buyers.
Condominium/Managing Agent Fee
When selling a condo, you will be required to submit a Condominium Application, which the condo may then chose to either exercise or waive its right of first refusal. Fees commonly associated with this process include the condominium attorney fee, which is generally around $500, a flip tax/transfer fee of anywhere from 1 to 3 percent of the purchase price. You can also expect to pay a move-out deposit or move-out fee ranging anywhere from $500 to $1,000 along with a managing agent’s processing fee of anywhere from $250 to $750. You may also be responsible for paying additional miscellaneous condominium charges, but you may also receive credit in the form of adjustments if you have paid certain common charges in advance that you are entitled to get back.
If you have a mortgage loan on your house or condominium, you will likely have to pay a pay-off bank fee that typically ranges from $250 to $750. As the seller, you are responsible for coordinating the payoff to your lending institution in order to satisfy the mortgage. The bank will then charge a fee to issue the payoff.
A number of different taxes could potentially be included as part of your closing costs. Some of the taxes you might have to pay if selling a property in New York include:
- New York City Transfer Tax: This fee can range from 1 to 1.45 percent of the purchase price depending upon the actual purchase price of the property
- New York City Commercial Transfer Tax: Goes into effect if you are selling two units that are being combined into one. The rate depends upon the purchase price and can range from 1.425 to 2.625 percent.
- New York State Transfer Tax: This tax is calculated as 0.4 percent of the purchase price.
- Mansion Tax: Applies to the sale of property with a purchase price of one million dollars or more. This tax typically is not paid by the seller, but may be included as a part of negotiations.
Other taxes may also be included in the final closing costs of your property. Be sure to review these carefully with an expert to ensure you are paying all of the necessary closing costs when selling your property.