Selling your home should put money in your pocket, not drain it. But many homeowners are shocked when they discover how much they’ll actually pay in closing costs at the end of the sale.
If you’re wondering who pays closing costs when selling a house, you’re asking the right question. Understanding these fees can help you plan better and avoid unwelcome surprises on closing day.
In this guide, we’ll break down exactly what closing costs are, who typically pays them, and how you can potentially avoid many of these fees altogether.
Who This Guide Is For
This article is especially helpful if you:
- Need to sell quickly due to divorce, job relocation, or financial hardship
- Can’t afford thousands in upfront costs and repairs
- Are dealing with an inherited property you don’t want to manage
- Face foreclosure and need to act fast
- Simply want to keep more money from your home sale
What Are Closing Costs When Selling a House?
Closing costs are the fees and expenses you pay when transferring ownership of your property to a buyer. These costs are settled at closing, which is the final step in the home sale process.
Most sellers assume the buyer handles all the costs. Unfortunately, that’s not true. Sellers typically pay a significant portion of closing costs, which can range from 6% to 10% of the home’s sale price.
On a $200,000 home, that could mean paying $12,000 to $20,000 in fees before you see a dime.
Common Closing Costs Sellers Pay
Let’s look at the typical costs sellers face in a traditional home sale.
1. Real Estate Agent Commission
This is usually the biggest expense. Agent commissions typically run between 5% and 6% of the sale price, split between the seller’s agent and the buyer’s agent.
Example: On a $200,000 home, a 6% commission equals $12,000.
2. Title Insurance
Title insurance protects the buyer and lender from issues with the property’s ownership history. In many states, the seller pays for the owner’s title policy.
Cost: Usually between $500 and $1,500, depending on your home’s value and location.
3. Transfer Taxes and Recording Fees
When you sell your home, your local government charges fees to officially transfer the property title and record the new deed.
Cost: Varies widely by state and county, but typically ranges from 0.5% to 2% of the sale price.
4. Attorney Fees
Some states require an attorney to handle the closing. Even where it’s optional, many sellers hire one for legal protection.
Cost: Between $500 and $2,000, depending on complexity.
5. HOA Documents and Transfer Fees
If your home is in a homeowners association, you may need to pay for document preparation and HOA transfer fees.
Cost: Usually $200 to $500.
6. Prorated Property Taxes
If you’ve already paid property taxes for the year, you’ll receive a credit. But if taxes are due, you’ll pay your share up to closing day.
Cost: Varies based on your local tax rate and closing date.
7. Home Inspection Repairs
While not technically a closing cost, many sellers agree to make repairs requested after the buyer’s home inspection. This can add thousands to your expenses.
Cost: Anywhere from a few hundred dollars to $10,000 or more.
8. Seller Concessions
Buyers often ask sellers to cover some of their closing costs as part of the deal. These concessions can include appraisal fees, loan origination fees, or credits toward repairs.
Cost: Typically 2% to 3% of the purchase price.
Who Pays What? Seller vs. Buyer Closing Costs
Here’s a general breakdown of who pays which costs in a traditional sale:
| Sellers Usually Pay | Buyers Usually Pay |
|---|---|
| Real estate agent commissions | Lender’s title insurance |
| Owner’s title insurance | Appraisal fees |
| Transfer taxes (in most states) | Home inspection |
| Attorney fees (their own) | Loan origination fees |
| HOA transfer fees | Homeowner’s insurance (first year) |
| Prorated property taxes | Their attorney fees |
| Repairs negotiated during inspection | |
| Seller concessions (if agreed upon) |
However, these aren’t set in stone. Everything is negotiable. In a competitive seller’s market, buyers might cover more costs. In a buyer’s market, sellers often pay more to close the deal.
How Much Should You Expect to Pay?
For a traditional home sale, sellers typically pay:
6% to 10% of the sale price in total closing costs
Breaking that down:
- 5% to 6% for agent commissions
- 1% to 3% for transfer taxes and title insurance
- 1% to 2% for repairs and other fees
So on a $250,000 home, you might pay $15,000 to $25,000 in closing costs.
That’s a lot of money that comes directly out of your profit.
The Hidden Costs People Forget
Beyond the standard closing costs, many sellers face additional expenses they didn’t plan for:
Staging and Preparation
- Professional cleaning: $200 to $400
- Minor repairs and touch-ups: $500 to $2,000
- Staging furniture rental: $2,000 to $3,000
Carrying Costs While Listed
- Mortgage payments during the listing period
- Utilities, insurance, and maintenance
- Lawn care and snow removal
These costs add up quickly, especially if your home sits on the market for several months.
Can You Negotiate Who Pays Closing Costs?
Yes, closing costs are negotiable. But your bargaining power depends on the market and your situation.
When you have leverage:
- In a strong seller’s market with multiple offers
- If your home is in excellent condition
- When buyers are eager and competing
When you have less leverage:
- In a buyer’s market with lots of inventory
- If your home needs significant repairs
- When you need to sell quickly
- If your home has been listed for months
The reality is that most sellers facing urgent situations don’t have the luxury of negotiating. When you need to sell fast due to foreclosure, divorce, or financial hardship, you often accept whatever terms get the deal done.
How Selling to a Cash Home Buyer Changes Everything
This is where cash home buyers offer a completely different approach.
When you sell to a cash home buyer, the traditional closing cost structure changes dramatically. Here’s how:
No Agent Commissions
Since there are no real estate agents involved, you save the entire 5% to 6% commission. On a $200,000 home, that’s $10,000 to $12,000 back in your pocket.
Buyer Covers Most Closing Costs
Reputable cash home buyers typically cover most or all of the closing costs, including:
- Title insurance
- Escrow fees
- Transfer taxes
- Recording fees
No Repairs Required
Cash buyers purchase homes “as-is,” which means:
- No inspection repairs to pay for
- No pre-sale renovations needed
- No staging or deep cleaning costs
- No ongoing maintenance while the home is listed
Faster Closing Means Lower Carrying Costs
Because cash sales can close in as little as 7 to 14 days, you save money on:
- Mortgage payments
- Utilities
- Property taxes
- Insurance
- Maintenance
No Seller Concessions
You won’t be asked to cover any of the buyer’s costs or offer credits.
Real Example: Traditional Sale vs. Cash Sale
Let’s compare what a seller might pay in each scenario for a $200,000 home.
| Traditional Sale Closing Costs | Cash Home Buyer Sale |
|---|---|
| Agent commission (6%): $12,000 | Agent commission: $0 |
| Title insurance: $1,000 | Title insurance: $0 (covered by buyer) |
| Transfer taxes: $2,000 | Transfer taxes: $0 (covered by buyer) |
| Attorney fees: $1,000 | Attorney fees: $0 to $500 |
| Repairs after inspection: $3,000 | Repairs: $0 |
| Staging and prep: $2,000 | Staging: $0 |
| 3 months of carrying costs: $4,500 | Carrying costs (2 weeks): $300 |
| Total Costs: $25,500 | Total Costs: $300 to $800 |
| Net Profit: $174,500 | Offer Price: $180,000 (10% below market) |
| Net Profit: $179,200 to $179,700 |
Even though the cash offer is lower than the market value, the seller actually nets more money because they avoid tens of thousands in fees and costs.
Common Questions About Closing Costs
Red Flags to Watch For
Not all cash buyers are the same. Watch out for these warning signs:
- Asking you to pay all closing costs (reputable cash buyers cover these)
- Charging hidden fees or “processing costs”
- Requiring upfront payments before closing
- Pressure to sign quickly without reading documents
- Vague or unclear contract terms
A trustworthy cash home buyer will be transparent about costs, provide a clear written offer, and give you time to review everything.
Is Selling to a Cash Buyer Right for You?
Selling to a cash home buyer makes sense if:
- You need to close quickly (within weeks, not months)
- You want to avoid expensive repairs and renovations
- You can’t afford to pay thousands in agent fees and closing costs
- Your home needs significant work
- You’re facing foreclosure or financial hardship
- You’ve inherited a property you don’t want to manage
- You’re going through a divorce and need a clean break
The key is understanding that you’re trading a potentially higher sale price for speed, convenience, and significantly lower costs.
How the Cash Home Buying Process Works
Curious about how simple the process actually is? Here’s a quick overview:
- Contact the cash buyer and provide basic information about your property
- Receive a fair cash offer within 24 to 48 hours
- Review the offer with no pressure or obligation
- Choose your closing date (often 7 to 14 days)
- Close and get paid with the buyer covering most closing costs
Want to learn more about each step? Check out our detailed guide on how it works to see exactly what to expect from start to finish.
Are you ready to start?
Get a fair cash offer and avoid thousands in closing costs today.
The Bottom Line on Closing Costs
When selling a house the traditional way, sellers typically pay 6% to 10% of the sale price in closing costs, agent commissions, repairs, and other fees.
For a $200,000 home, that could mean $12,000 to $20,000 or more coming out of your pocket.
Cash home buyers flip this model. They cover most or all closing costs, buy your home as-is, and close quickly. While the offer price may be lower than market value, you often net more money after accounting for all the fees you avoid.
If you’re tired of worrying about closing costs, repairs, and lengthy sales processes, selling to a cash buyer might be the solution you need.
Ready to Skip the Closing Cost Headaches?
Don’t let closing costs eat into your home sale profits. Get a fair, no-obligation cash offer and see exactly how much you could save by avoiding agent fees, repairs, and lengthy listing periods.
Contact us today to learn more about how our process works and get your free cash offer in as little as 24 hours.
