I have met with hundreds of Cobb County homeowners and one question they always ask me is, “How much will it cost me to sell my home?”.  Prior to listing a home, I ALWAYS complete an Estimated Net to Seller Worksheet for the homeowner.  Because, quite frankly, at the end of the day the most important thing to the home seller is how much money they are going to have left over from the sale (aka “net proceeds”).  Oftentimes this “net” is what will allow them to make their next home purchase.  Without knowing what they are going to walk away with…how will they know what they can afford for the next purchase?

I know that cost vary from state-to-state, in Cobb County here is a summary of what you can expect.

Prior to the Closing:

Inspection items

In most resale transactions, the Buyer receives the right to inspect the property and perform their “Due Diligence”.  During this period, the Buyer may request that repairs be made to the home.  These are negotiable between the buyer and seller and vary greatly depending on the amount negotiated and the condition of the home.

At the Closing

Seller Contributions Toward Buyer Closing Cost

In my video Understanding Closing Cost, I explain what Buyer Closing Cost are and how much the Seller can expect to pay.  This is a negotiable item.  Sometimes the buyer request for the seller to contribute part of their proceeds to help offset the Buyer’s cash outlay.  If negotiated, these cost are averaging between 3 to 6% of the sales price here in Cobb County.

Real Estate Commissions

In Georgia, it is the Seller’s responsibility to pay the real estate commissions.  Since real estate commissions can vary depending on the services provided by the agent and the type of property we encourage you to Contact Us directly to find out what the commission would be on your property.

ProRated Share of Property Taxes

Cobb County property taxes are paid in arrears.  The Cobb County Tax Assessor usually sends your property tax bill in September or October.  So a bill received in October 2011 will pay the for the 2011 taxes (not 2012 taxes).  So if you close BEFORE you have paid the Cobb County Tax Bill (i.e. before October) then you will have to pay your Prorated share of taxes for the year.  You can estimate this amount by with this formula:

Most Recent Tax Bill Amount   Divided by 365  = Daily Tax Amount

Daily Tax Amount Multiplied by Number of Days You Owned the House This Year = ProRated Share of Taxes

If you close on your home after your tax bill is paid, then the buyer will reimburse you for the prorated time that they are occupying the house.  Generally, if you close later in the year you will get money from the buyer for your taxes at the closing (as a credit on the HUD1 Settlement Statement).

ProRated Share of Homeowner’s Association Fees

Do you live in a community that has a Homeowner’s Association, and are you required to pay dues to live in that community?   If so, you will have to pay your prorated share of these dues for the days that you owned the home.  Most HOAs require that the dues be paid in advance at the beginning of the year.  In that case, the buyer would actually give you money back (as a credit on the HUD1 Settlement Statement).

Homeowner’s Association Fee for Closing Letter

Prior to closing on a property, the closing attorney will contact your HOA to ensure that you are current on your dues and that there are no outstanding payments.  They receive a “letter” from the HOA verifying that you are current or stating any outstanding dues and/or fees.  A lot of the HOA management companies in Cobb County are now charging a fee to the Seller.  I have seen these vary from $50 to $150.  You should contact your HOA to find out exactly what the fee will be when you sell your home.

Payoff of Mortgages on the Property

If you have a mortgage, a second mortgage, and/or an equity loan on your home, you will have to pay these off in full from the proceeds of the sale of your home.  Please note that the amount remaining that is shown on your monthly payoff statement will, most likely, not be the exact amount of your “payoff”.  The payoff includes both principle balance and any interest incurred the month of the closing.  I recommend, once you know your closing date, that you contact your loan service department and inquire what the exact payoff amount will be.

Loan Payoff Courier Fees

Every day that the loan is not paid off cost you interest expense.  Most of the time the attorney’s will overnight the loan payoff to save you a day or two of interest expense.  You may be charged a fee for this service by the attorney.  I have seen it range between $50 to $100.

Home Warranty

I’d estimate that in 7 out of 10 resale transactions the Buyer request that the homeowner provide a home warranty.  What this means is that the homeowner pays a fee to an outside company who innturns warranties various items in the house (usually the HVAC, plumbing, electrical and appliances).  This is a cost that is negotiated as part of the contract.  It can average in cost from $350 to $500 – or more for larger homes.

This list covers most of the standard Seller cost that I see during a closing.  There may be other cost such as Capital Gains Tax if you are a Non-Georgia Resident, additional cost to payoff of Outstanding Liens and Judgements, a charge for the attorney to help you draft a Power of Attorney if you can not attend the closing, courier fees if you want to have the closing documents sent to a location other than where the closing is taking place, etc)

All of these items are reflected on a Settlement Statement (HUD1) that is regulated by the United States government.  The end result is the “net proceeds” that you will receive when you close.

I keep a detailed spreadsheet that I use to help my clients better estimate what their “net proceeds” will be before they even list their home for sale.  Contact Us today if you would like to find out what your “net” may be.

Proposed Sales Price
	Less: Seller Contribution to Buyer Closing Cost
	Equals: Net Sales Price
Selling Expenses
	Present Loan Balance
	Interest Adjustment
	Home Warranty
	Loan Payoff Courier Fee
	FHA Required Closing Cost
	GA Capital Gains Tax (Non GA Res)
	Property Taxes
	Real Estate Commissions
	Repair Allowances
	Other
Total Estimated Selling Expenses
Credits
	Homeowners Association Reimbursement
	Escrow Account Balance
	Taxes
	Other
Total Credits
Estimated Net To Seller