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Closing Costs

Closing Costs:

For Sellers: When we get a fully executed contract, sellers will be given an estimated net sheet, subject to final costs from the lender, title company & attorney. The most significant closing costs that Seller(s) are responsible for are:

  • Mortgage(s) Payoff - the figures come from your current lender & may include a 1st or 2nd Mortgage, and/or a Home Equity Loan or Line of Credit. All these amounts must be paid off in order to transfer title to the new owner.
  • Brokers' Commission - note that this fee, paid to your Broker of record, includes an amount to compensate the buyer's Broker (if there is one), notice of this compensation is listed in the Multiple Listing Service Listing; it not only incents them to bring their Buyers to your property, but assures them that they will be compensated at closing.
  • Real Estate Transfer Taxes - these municipal fees can be significant and vary from city to city by local ordinance. In most municipalities, the Seller is responsible for these fees; cities where the Buyer pays instead of the Seller include the City of Chicago, Wilmette, and Berwyn. In Evanston, Seller pays $5 per $1,000 of purchase price, except in the case of newly constructed properties where the buyer is asked to pay the transfer taxes. These transfer tax stamps must be purchased in advance of the closing. Most cities will not issue stamps if any debts due to the city by the property owner are unpaid, such as a water bill or a parking ticket.
  • Real Estate Tax Proration - depending on your contract terms, and the calendar date of closing, the Seller credits the Buyer at closing on a prorated basis. It is best to ask your attorney for this amount.
  • Mortgage Interest Accrued to date of closing; depending on the calendar date that you close, this amount will be applied up to and including the date of closing.
  • Special Assessments - this is sometimes a surprise item; any type of property may have a special assessment that has been levied prior to the sale for which the Seller is generally responsible. Examples of this are a special assessment in a condominium for a new roof, or an alley paving special assessment for a single family home.
  • Miscellaneous Other Fees - other small amounts will appear on the closing statement, some examples are: attorney's fee, document fee, title search fee, closing room fee, etc. These fees typically may add up to well over $1,000. Ask your attorney for more information.

For Buyers: The most significant closing costs that Buyer(s) are responsible for include:

  • Down Payment - This amount is agreed upon between Buyers and their lender, and it varies widely. Unless the down payment amount is at least 20% of the Purchase Price, the lender will require the Buyers to pay PMI, Private Mortgage Insurance, along with the monthly principal, interest, and tax escrow amounts. Today, there are lenders who may loan 100% of the purchase price, depending upon the financial situation of the Buyers, that is their income, bonus, debt and credit history; the mortgage rate for these higher risk loans will be higher than a conventional loan where the down payment is substantial. Ask your lender for more information. Third Meridian Realty, L.L.C. can provide you with a list of reputable lenders. Be wary of choosing a lender from the Internet if they are unknown to you or your Realtor.
  • Real Estate Transfer Taxes - these municipal fees can be significant and vary from city to city by local ordinance. In most municipalities, the Seller is responsible for these fees; cities where the Buyer pays instead of the Seller include the City of Chicago, Wilmette, and Berwyn. In Chicago, Buyers pay $7.50 per $1,000 of purchase price for city, state, and county transfer taxes. In Evanston, developers of new construction require Buyers to pay the transfer taxes of $5 per $1,000 of purchase price. For Wilmette, the Buyer pays $3 per $1,000 of purchase price to the village. These transfer tax stamps must be purchased in advance of the closing. Most cities will not issue stamps if any debts due to the city by the property owner are unpaid, such as a water bill or a parking ticket.
  • Miscellaneous Other Fees - other small amounts will appear on the closing statement, some examples are: loan origination fee, appraisal fee, attorney's fee, document preparation fee, title insurance fee, closing room fee, courier fee, etc. These fees typically may add up to well over $1,000. Your lender will give you a Good Faith Estimate of Closing Costs.