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5 min read Sep 21, 2023

How Much are For Sale By Owner Closing Costs?

For Sale By Owner implies selling a house yourself, without involving a real estate agent. This also means you save 3% on the average real estate commission that you would otherwise pay your listing agent.

In most FSBO transactions, home sellers usually pay the same closing costs they would pay in a conventional sale. However, you can negotiate closing costs with the buyer, depending on your locality or home’s condition.

Let’s take a look at how much For Sale By Owner closing costs you’ll pay when selling your home yourself.

Key Takeaways

  • On average, For Sale By Owner closing costs can make 5% to 8% of the home’s final price.
  • Closing Costs For Sale By Owner typically consist of the buyer agent’s commission, attorney fees, mortgage payoffs, unpaid HOA fees, transfer tax, property tax, and more.
  • Although you cannot avoid paying FSBO closing costs, you can negotiate with the buyer and reduce them.
  • FSBO closing costs are relatively less than seller closing costs, as they do not involve the average 3% listing agent commission.

What are Closing Costs For Sale By Owner?

Closing costs For Sale By Owner are the expenses that an FSBO home seller incurs at closing. This makes up 5% to 8% of the home’s final selling price.

FSBO closing costs don’t include commission paid to a seller agent, as you sell your home on your own. Hence, the majority of closing costs for FSBO sellers include buyer agent commission, mortgage payoffs, transfer tax, unpaid property taxes, and more.

How Much Are Closing Costs For Sale By Owner?

When selling FSBO, a homeowner may end up paying approximately 5% to 8% of the home’s selling price at closing. Here’s a breakdown of FSBO closing costs:

  • Buyer Agent Commission: The biggest chunk of closing costs For Sale By Owner is the buyer agent commission. It can make up to 3% or more of the final selling price. You can skip offering this incentive to buyer agents, but chances are your house will stay on the market for longer as no buyer agents approach you with offers.
  • Attorney Fees: Hiring a real estate attorney is generally advised for FSBO home sellers. Attorneys can draft the FSBO contract and save you from legal troubles. Typically, real estate attorneys charge $150 to $500 hourly, depending on your location.
  • Mortgage Payoffs: You must pay off any pending balance on your mortgage before transferring the property. Check with your lender about mortgage prepayment terms, and whether you’ll have to pay a prepayment penalty. This penalty can cost you about 2% of your outstanding balance.
  • HOA Fees: If you are part of a Homeowner’s Association, you’re required to pay all outstanding fees. Likewise, the HOA also charge a transfer fee of $100 to $400 for record update of the new ownership.

Apart from these FSBO seller closing costs, you also pay a few costs that are split between you and the buyer. These involve escrow fees, settlement fees, home inspection costs, transfer tax, and more.

Can I Avoid FSBO Closing Costs?

Unfortunately, no. Closing costs are an essential part of any home sale transaction, whether it be conventional or FSBO.

However, you can reduce your share substantially by not hiring a listing agent and selling your house yourself.

Although FSBO means taking no assistance from a Realtor, you still have ways to work like a real estate agent yourself. This involves marketing your property, negotiating with prospective buyers, and managing closing.

The fastest way to sell your house For Sale By Owner is to list on the MLS with a flat fee MLS listing service. You can list on FSBO websites that offer advanced tech tools and help you conduct showings and review offers.

Lastly, you can always negotiate with the buyer. Remember, there are no hard and fast rules on who pays closing costs, and most fees can be negotiated at the closing table.

For Sale By Owner Closing Costs Calculator

Houzeo’s FSBO Closing Costs Calculator can give you an estimate of the closing costs.

Let’s understand this with an example. Suppose you are selling a home in Florida worth $500,000. Likewise, you are offering a buyer agent commission of 3%. Here’s a breakdown of your closing costs given by Houzeo’s closing cost calculator:

for sale by owner closing costs calculator

With Houzeo you can save $14,621 in real estate commissions. Not just that, several home sellers have saved even more by selling FSBO with Houzeo.

Eager to Know More About Houzeo?

We’ve got you covered. Check out the following video to understand why Houzeo is one of the best for sale by owner websites in the U.S.

What is Houzeo?

An overview of what the platform is all about

Start Your MLS Listing NOW!

» NEED MORE CLARITY? Read these exclusive Houzeo reviews and learn why it is one of the best FSBO sites in America.

Frequently Asked Questions

1. Do closing costs include realtor fees for buyer?

No, the seller pays the realtor's fees. Realtor fees are included in the closing costs and are therefore included in the calculator.

2. Who pays for closing costs when selling a house by owner?

Generally, sellers and buyers both pay closing costs, which are divided between them. Typically, buyers bear the majority of closing costs, while sellers pay the real estate agent's commission.

3. Are closing costs and commission the same thing?

No, closing costs are not the same as real estate commissions. It is part of For Sale By Owner Closing Costs.

4. Does the seller pay closing costs?

Yes, the seller pays 8% to 10% of the purchase price as closing costs. This majorly includes the real estate agent's commission, attorney fees, mortgage payoffs, and HOA fees.

5. How much does it cost to sell house by owner?

Approx. $4000 minimum. Before even selling your home, you will need to spend quite a bit of money up front, from marketing costs to home tours to hiring a photographer, inspector, and attorney.

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