The easy answer to that is, it’s negotiable. In Virginia, it depends on the terms of the contract and what the buyer and seller agree to.
However, both parties are usually responsible for their own legal representation. That said, attorneys are optional for real estate closings in Virginia.
If you hire an attorney, you may pay for attorney fees associated with your mortgage loan, while the seller may pay for attorney fees related to the title transfer. It all depends on what’s written in the contract.
However, both parties are usually responsible for their own legal representation. That said, attorneys are optional for real estate closings in Virginia.
If you hire an attorney, you may pay for attorney fees associated with your mortgage loan, while the seller may pay for attorney fees related to the title transfer. It all depends on what’s written in the contract.
What are the Key factors Influencing Who Pays What at Closing?
There are at least 4 factors that influence who pays for closing fees. First and foremost is the contract because it is the ultimate document that outlines everything in making the legal transfer to another owner, including attorney fees.
Market conditions are another big factor. If housing inventory is low, sellers may be less willing to pay for any part of closing costs, leaving it to the buyer to foot the entire bill.
If the market is slow, then sellers may be more open to paying for closing costs as an incentive to sell their home more quickly.
Buyers can always negotiate with sellers to pay some of their closing costs including attorney fees especially in a seller’s market.
If the real estate transaction is a more complex legal situation, an attorney may be needed to represent either the buyer or the seller, or both.
Market conditions are another big factor. If housing inventory is low, sellers may be less willing to pay for any part of closing costs, leaving it to the buyer to foot the entire bill.
If the market is slow, then sellers may be more open to paying for closing costs as an incentive to sell their home more quickly.
Buyers can always negotiate with sellers to pay some of their closing costs including attorney fees especially in a seller’s market.
If the real estate transaction is a more complex legal situation, an attorney may be needed to represent either the buyer or the seller, or both.
What are the Closing Costs for Buyers in Virginia?
Typically, unless it’s a cash transaction, buyers pay for:
• Loan application and origination fee-It’s standard for lenders to charge a fee associated with apply for and originating a home loan.
• Credit report-Lenders may charge a small fee to check your credit.
• Escrow-If your lender requires you to make an escrow deposit for property taxes and/or home insurance premiums, you may have to pay a maintenance fee as well.
• Title insurance and search-In Virginia, buyers for the lender’s title insurance. Buyers must purchase their own homeowner’s title insurance. Learn more about that here.
• Mortgage points—If you want to get a lower interest rate, you may be able to buy mortgage points upfront. This can save you money in the long run.
• Appraisal-Your lender will require an appraisal to establish that the home is worth the amount of money you are borrowing.
• Home Inspection-This one isn’t a requirement but it’s worth the money to get one. A home inspection can identify any major problems with the home. Or any problems that are developing. Those can then be presented to the seller to fix before the sale becomes final.
• Transfer tax-This tax covers property ownership transfer. Buyers usually pay the recordation fees along with other taxes. Sellers must pay their own transfer fee.
• Loan application and origination fee-It’s standard for lenders to charge a fee associated with apply for and originating a home loan.
• Credit report-Lenders may charge a small fee to check your credit.
• Escrow-If your lender requires you to make an escrow deposit for property taxes and/or home insurance premiums, you may have to pay a maintenance fee as well.
• Title insurance and search-In Virginia, buyers for the lender’s title insurance. Buyers must purchase their own homeowner’s title insurance. Learn more about that here.
• Mortgage points—If you want to get a lower interest rate, you may be able to buy mortgage points upfront. This can save you money in the long run.
• Appraisal-Your lender will require an appraisal to establish that the home is worth the amount of money you are borrowing.
• Home Inspection-This one isn’t a requirement but it’s worth the money to get one. A home inspection can identify any major problems with the home. Or any problems that are developing. Those can then be presented to the seller to fix before the sale becomes final.
• Transfer tax-This tax covers property ownership transfer. Buyers usually pay the recordation fees along with other taxes. Sellers must pay their own transfer fee.
What are the Closing Costs for Sellers In Virginia?
Besides paying for the real estate commission, the closing costs for sellers include:
• Title--Sellers are responsible for some title-related fees in Virginia just as the buyer is.
• Transfer tax-As mentioned above, both the seller and the buyer must pay a transfer tax, also called mortgage stamps.
• Any Outstanding Property Taxes and HOA Fees-All property taxes and HOA fees must be paid before the property can transfer ownership.
• Concessions-Sometimes sellers concede to pay a portion of the buyer’s closing costs in order to close the deal.
• Home Warranty-Sometimes sellers will offer to cover the cost of a home warranty, which protects major systems and appliances, but this is optional.
• Wire Transfers-Banks will usually charge a small wire transfer fee if you’re transferring money to pay off your existing mortgage.
Because buying and selling real estate is so legally complex, it is best to have someone look over your contract before making final agreement. Whether it’s an attorney or a real estate agent, hire someone who is knowledgeable and can carefully read the terms and payment responsibilities for each party.
This is the biggest investment of your life. Don’t take any unnecessary chances!
When you’re ready to close on your new home, turn to Lilly Title & Settlement, a woman-owned title and settlement company in Staunton, VA. We’re obsessed with legal details so you close on your home smoothly and easily!
• Title--Sellers are responsible for some title-related fees in Virginia just as the buyer is.
• Transfer tax-As mentioned above, both the seller and the buyer must pay a transfer tax, also called mortgage stamps.
• Any Outstanding Property Taxes and HOA Fees-All property taxes and HOA fees must be paid before the property can transfer ownership.
• Concessions-Sometimes sellers concede to pay a portion of the buyer’s closing costs in order to close the deal.
• Home Warranty-Sometimes sellers will offer to cover the cost of a home warranty, which protects major systems and appliances, but this is optional.
• Wire Transfers-Banks will usually charge a small wire transfer fee if you’re transferring money to pay off your existing mortgage.
Because buying and selling real estate is so legally complex, it is best to have someone look over your contract before making final agreement. Whether it’s an attorney or a real estate agent, hire someone who is knowledgeable and can carefully read the terms and payment responsibilities for each party.
This is the biggest investment of your life. Don’t take any unnecessary chances!
When you’re ready to close on your new home, turn to Lilly Title & Settlement, a woman-owned title and settlement company in Staunton, VA. We’re obsessed with legal details so you close on your home smoothly and easily!
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