Riverside Realtor Blog - Alma Dizon

Alma shares her experiences and observations as a Realtor in Riverside California.

Sunday, August 13, 2006

What do the Sellers Usually Pay For?

Sellers should always get several estimated net sheets from the listing agent. They need to get one when they sign, when they adjust the price and/or the commision, and when get an offer comes in.

The estimated net sheet should list all the different items that the sellers usually pay for, plus any extras that the offer (or counter offer) entails.

For instance, the sellers need to take into account the following: commissions to each side, title and escrow costs, termite inspection (not including any repairs), natural hazard report, city and county transfer taxes, HOA transfer fees, prorated interested on the loan(s), reconveyance fee for the loan(s), grant deed preparation, one-year home warranty for the buyer, and any prepayment penalty. Depending on the buyer's situation, the seller may need to take into account paying closing costs, points, and fees for a VA or FHA loan.

The commission should be based on the net, that is the accepted price minus any closing costs and points. So if the accepted price is, say 700k, and the sellers are paying 2 points or 14k to lower the buyer's interest rate, they should pay a commission based on 686k. When they get the commission instructions from escrow, they should also go over the numbers and make sure that they're based on the net. If escrow makes a mistake, they can call and get another set of instructions drawn up.

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