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If you’re planning to sell your house, you’re probably wondering how much you’ll make. But what about how much the home sale could cost? After all, before you can pocket the proceeds, that purchase price will have to cover the costs of the transaction. In this post, we’ll go over the total cost of selling a house, so you know what expenses to expect.

Mortgage payoff

For most sellers, the most significant cost of selling a house is the remaining balance on their mortgage. To get the most accurate payoff amount, it’s a good idea to call up your lender and ask – don’t just rely on your last billing statement. Though rare, some lenders also charge a prepayment penalty for ending your loan early, so factor that in as well, if applicable. Learn more about selling a home with a mortgage here.

Tip: Your mortgage payoff only includes the interest you’ve accumulated up to your closing date, not the lifetime interest of the loan.

Real estate agent commission

Agent commissions are usually the second biggest cost of selling a house. Home sellers handle the fee for their own listing agent, as well as the fee for the buyer’s agents. Both sets of commission typically add up to about 6% of the home’s purchase price. However, the exact percentage can also vary depending on your area, property type, etc.

Buyer’s closing costs

Depending on the market, buyers may ask that the seller pays for some of their closing costs – this is called a “seller concession” or “a credit toward closing costs.” A home buyer might request a seller concession in their offer if they think the house is overpriced or if they want help covering the upfront costs of purchasing a home. These closing costs can include the appraisal, inspection, and lender fees.

Home preparation

To get your house ready to sell, it’s often a good idea to make some home improvements to boost your home’s appeal. You’ll likely spend money on things like deep cleaning, painting, staging, and curb appeal. Many sellers also end up making repairs ahead of time for things they expect potential buyers will flag. While this is an upfront cost of selling a house, you could potentially recoup this expense if the improvements boost your home’s value.

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Post-inspection repairs

Buyers may also request a seller concession later in the process after they get the results of the home inspection. They can do this by negotiating a seller concession to cover the cost of any necessary repairs. Alternatively, they could also ask that you fix the damage yourself before closing. Either way, you’ll be responsible for the price of these requested repairs.

Negotiating with a buyer about repairs doesn’t just cut into your bottom line, it’s also time-consuming. But what if you just want to sell your home in its current condition and get on with your life? At Orchard, we’ll purchase your house for market price in its current condition, so there’s no need to make repairs yourself.

Title insurance and related fees

When you sell your home, you’ll usually need to hire a title company to transfer the title to the home buyer. (A title is a document that verifies your legal ownership of your house.) You’ll also need to pay for the new owner’s title insurance, which will protect them in case there are any issues with the deed down the road. Many title companies also offer escrow services, which they’ll include in their fee.

Taxes and neighborhood fees

When you sell your home, you also have to take care of local taxes and fees. Because you get billed for state property taxes only a few times a year, on your closing day, you’ll be responsible for the charges that have accumulated since your last payment.

And depending on the location of your property, there may also be a fee for transferring ownership of the home. The exact amount you’ll need to pay can drastically vary from state to state. For example, Texas has no transfer taxes, Arizona has a $2 flat fee, and Delaware has a 1.5% fee (NAR).

Lastly, if your neighborhood has a homeowners’ association, you’ll need to cover the HOA fees that you collect leading up to your closing date. You can also expect to pay a fee to your HOA to have them transfer your property over to your buyer.

Attorney fees

If you end up hiring a real estate attorney to complete the home closing, the seller is on the hook for their fees. Some states require the presence of an attorney, while others give you the option to choose. For example, New York law calls for attorneys, while Texas does not. Depending on your scenario and the attorney’s hourly rate, you can expect to pay between several hundred and a thousand dollars.

Overlapping housing costs

It can be challenging to line up your closing dates for selling your old house and moving into your new one. If you buy your new home first, you’ll have to pay for two mortgages, taxes, and utilities until your old home sells. On the other hand, if you sell your current home first, you may end up paying for temporary housing or storage until you can find and close on your new home.

Moving costs

When considering the cost of selling a house, sellers often forget to budget for the move itself. There are always expenses associated with the moving process, whether you’re hiring movers or doing it yourself. Even the DIY route can add up, with truck rentals, gas expenses, packing supplies, etc. If you end up having to move into temporary housing between houses, those double moves can increase the overall cost as well.

The true cost of selling a house: Final thoughts

And there you have it! There are many costs of selling a house, most of which are pretty unavoidable. However, if you’d like to avoid the stress and cost of overlapping housing costs or having to move twice, consider selling your home to Orchard. We’ll work to line up your closing dates, so you can move out on your schedule and avoid any overlapping housing costs.

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