In addition to Real Estate Brokerage fees which we plan to avoid, other fees that must be paid by the fsbo Seller on closing day are grouped below.
Buyers mortgage costs: In most states, the Seller traditionally pays fees associated with the Buyer getting a real estate mortgage loan. These fees are typically 1% to 1.5% of the loan amount. ($900 to $1,350 on a $90,000 mortgage)
Other Closing fees: These include attorney fees, title search, and recording fees (see second page of settlement statement). A good estimate is 1% to 1.5% of the sales price. ($1,000 to $1,500 on a $100,000 home)
Real Estate Brokerage fees:
Brokerage fees or commissions can easily be the Seller's biggest cost.
If the Seller lists the home with a real estate agent, he can expect to pay between 6% and 7% of the purchase price ($6,000 to $7,000 on a $100,000 home).
If Seller sells home on his own, but accepts a Buyer brought by a real estate agent, the Seller will usually have to pay half of the above amount or 3% to 3.5% of the purchase price ($3,000 to $3,500 on a $100,000 home).
The best situation is where the Seller advertises his own home, gets his own Buyer and pays nothing to real estate agents.
The Seller can limit his costs by stipulating in the Sales Contract a maximum amount he will pay towards the Buyer's mortgage costs and Other Closing fees.
Real Estate Brokerage fees are subject to a separate agreement with the real estate agent and are not usually limited in the Sales Contract.
See "Net Cash from Sale" for a calculation of how much cash you can expect after the mortgage balance and fees are subtracted from the selling price.
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