What Are the Closing Costs When Paying Cash for a House?
According to About.com, as a cash-in-hand buyer, you are free from the closing costs associated with taking out a mortgage, but you will be expected to cover at least some of the costs related to escrow; document-transfer tax; local property taxes; appraisal; recording and notary fees; and some types of inspections. Depending on the custom in your area, according to About.com, some of these costs may be borne by the seller.
Buying a house with cash saves you the trouble and expense of borrowing, but it doesn’t entirely liberate you from the non-financing costs that accrue with every transfer of real estate. Some of these costs, such as realtor commissions, are the responsibility of the seller and will typically be deducted from the agreed-upon price of the house. Others, such as property taxes and hazard insurance, are likely to fall on the buyer.
Depending on whether you’re operating in a buyers’ or sellers’ market, many fees can be assigned to either party by negotiation. About.com has an exhaustive list of the fees attached to home sales, and it never hurts to ask about deductions to the home’s sale price that will help you cover the out-of-pocket expenses you’re taking on along with your new home.
