It is probably the No. 1 Question I get from anyone thinking of buying or selling a home: “What will be my closing costs?”
Closing Costs in Western Washington
The costs incurred at closing differ from region to region across the country. This post relates to the Puget Sound region and pretty much everywhere served by the Northwest Multiple Listing Service. That is because closing costs are largely apportioned by the form used for the Purchase and Sale Agreement.
Closing requires the involvement of a title insurance company to make sure title is good and all liens are paid. The buyer obtains a title insurance policy, as does any lender. Closing also requires the services of escrow and a closing agent. Finally, the Tax Man gets his share too.
Total Closing Costs Incurred by Transaction
There is a great tool on the internet that will give you this exact information. From Fidelity National Title (but allowing for quotes from other title companies), this closing costs calculator really delivers the goods. It omits just the tax due.
These total costs as shown on the calculator are apportioned between the buyer and the seller per the terms of the PSA.
Closing Costs Paid by Seller in Seattle
- Excise tax of 1.78%
- Owner’s title insurance policy (for the buyer)
- One half escrow
- Recording cost of deed
And of course a handful of “miscellaneous” charges and fees of a few hundred bucks. All told, these costs usually approach 3%, which is a good rule of thumb.
Closing Costs Paid by Buyer in Seattle
- Loan costs (includes origination fee, appraisal, buy-down, etc. – get this info from the lender)
- Pre-paid property taxes and homeowner insurance premiums (as required by the lender)
- Lender’s title insurance policy (which protects the lender)
- One half escrow
- Recording cost of deed of trust
With, once again, the usual “miscellaneous” charges and fees.