Home sales in 2019 are sagging below initial expectations and are now projected to come in lower than 2018 numbers. That being said, as the market’s prices adjust, sales volume is expected to pick back up through 2020.
That’s good news for you if you’re a seller that’s looking to get a great return on their home investment.
One of the factors that really diminish returns for sellers (and one that many overlook) are closing costs.
“Closing costs” is an umbrella term that encompasses a variety of fees that sellers need to pay for out of their earnings in order to ensure that their home’s sale goes smoothly.
In this article, we offer some low-hanging tips that you can leverage in order to reduce the closing costs for seller burden.
1. Weigh Your Realtor Options
One of the most cited closing costs for seller line items are agent fees. Chances are if you’re selling your house, an agent is going to help you do it.
That agent will collect a percentage of your home’s total sale price for their work. In addition to that, there are buying agent fees (which you can learn more about) that you’ll also probably be on the hook for.
To bring the burden of these costs down, one of the simplest things to do is meet with a lot of agents to see which ones are willing to offer you the best deal. Many sellers get a single agent pitch and hire that agent for the purpose of expediency.
Don’t fall into that trap and be sure to budget a fair amount of time to interviewing agent candidates.
2. Ask if Commissions are Negotiable
If you’re not sure how you can work with an agent to bring down your closing costs burden, a good place to start is by asking them if their commissions are negotiable.
This may surprise you, but most real estate agents will not budge on their rates because many in the industry consider them to be standard and set. We mention that because we don’t want you to get discouraged if you’re told no by the first couple of agents that you meet.
Chances are, with a little persistence, you’ll find an agent that is willing to budge in order to earn your business.
3. Ask For More Services
When you can’t get a real estate agent to budge on their commission, one of the best ways to follow up is to try and get them to offer you more services.
For their commission, real estate agents provide a set number of services. These services in their most basic form include listing your house in the MLS and negotiating with prospective buyers.
In addition to those services, you can request that your agent invest in robust marketing stunts.
Some of these stunts might include taking local ads out in papers, hosting open houses and more.
4. Opt for a Flexible Listing Agreement
You never know when you’re going to run into a real estate agent that can offer you more for less. Many times, you end up meeting better value agents when you’re already working with an existing one.
To ensure that you’re never locked out of getting a better deal and reducing your closing costs for seller burden, try and negotiate a flexible listing agreement.
Listing agreements basically promise your property listing to a particular agent. If your agreement is flexible, you’ll have more options when it comes to letting your agent go to pursue another one.
5. Do Your Own Title Search
Title searches are necessary because they provide buyers with the assurance that they need when it comes to making sure that nobody has a lien on your home.
In plain speak, title searches prove to buyers that you actually own the house that you’re selling them.
While most sellers turn to title search companies to go through his process, you can actually save money and do it yourself.
To get started with this process, find a local “Abstractor” (the professional title companies use to pull titles). Once you’ve found a reputable one, ask them about the title pulling process for your county and simply follow their directions.
6. Make Sure Your Loan Doesn’t Carry Prepayment Penalties
Here’s something that shocks a lot of home sellers… Your loan company may charge you a fee for selling your house before paying it off.
This fee is called a “prepayment penalty” and it’s your loan company’s way of collecting a little bit on all of that interest they’re losing out on by you clearing out your loan ahead of schedule.
The good news here is that many loan providers do not charge this fee. Always do businesses with providers that don’t so that you don’t unnecessarily decrease your home’s value.
7. See If Your Buyer Will Offset Costs
Selling your house in a competitive market? If so, you may be able to leverage your buyer’s neediness by asking them to offset your closing costs for seller burden.
Buyers will probably not be initially receptive to the idea of covering your closing costs since this is not a common practice. Still, if you have the sway to make the request, there’s no harm in doing so.
Wrapping Up Ways to Reduce Closing Costs for Seller
Closing costs for seller related charges can sneak up on you when selling your home. To make sure that those sneaky charges don’t eat away at your bottom line too severely, take our advice above into account and start saving money!
The world of home selling, fixing and more is a complicated one. To make things easier, check out more content on Gaby Creates today!