Thursday, December 8, 2016

What Goes Into Closing Costs?



Prior to the closing date, you (as either a buyer or a seller) will receive a closing statement that will lay out the line item details of the real estate transaction.  The items are set up as debits and credits, with the seller's on one side and the buyer's on the other.  The totals, showing what a buyer or seller needs to either bring or receive from closing, are listed at the very bottom of the last page.

Some of the detailed line items include (but not limited to) the sale price of the property, any credits (e.g. if a seller is paying toward closing costs), taxes, loan and processing fees, interest, the appraisal, certifications, homeowner's insurance, title fees, commissions, recording fees, loan payoffs, and home warranty (if applicable).

There can be variations in the line items.  For example, tax amounts can vary in different counties, there can be additional taxes for a particular city/neighborhood, commission is affected by the sales price, and the loan amount can affect the pro-rated daily interest rate that is paid.

There are attorney's fees for both the buyer and the seller.  The buyer has more closing costs with a loan; however, it is important to note that the seller has to pay a closing fee and a fee for deed preparation work.  This is for the attorney's work to essentially get the title transferred.  So, it is important to keep in mind, as a seller, that, even if you are paying toward the buyer's closing costs, you will still have title fees to pay at closing.

Give me a call with any real estate questions or needs.

Matt Gatewood
Realtor®
Keller Williams Louisville East
502-594-6582

How Accurate Are Trulia, Realtor.com, and Zillow?



There are many great real estate search tools available on the Internet now.  A question of their accuracy comes into play when buyers are looking for properties.

There are two primary parts to the question I'm asking in how accurate are the on-line search tools.  One is how accurate is the data about the listings (status, price, etc.).  The second part is how much trust can be put into the estimated value of a property that some sites try to predict.

In regard to the first part, the websites are pulling data from another primary source, like the Multiple Listing Service (MLS) that Realtors use to list property.  The MLS has a local governing body to monitor accuracy, as well as self-policing from other licensed agents.  Sometimes, when data is pulled from the MLS to another site, issues occur (I've seen examples like contact information or the last sold date being inaccurate).  That doesn't mean that the sites are bad, it is just a forewarning to proceed with caution.    

In regard to the second part, there have been efforts in the past to automate what appraisers do in valuing property, but it has never come to fruition.  The simplest reason is because no two properties are ever the same (even new construction of the same style can be on a different size/type of lot).  It takes human intervention to try to assess market value of a property.

The sites have their merit and place.  However, one of the biggest reasons I tell buyers to use the MLS as the primary search tool over the other sites is timing.  I can set up a search that will notify buyers immediately when a new listing comes onto the market.  I have never seen the other sites get the information into the hands of the buyers so quickly.

If you have any real estate questions or needs, please give me a call.

Matt Gatewood
Realtor®
Keller Williams Louisville East
502-594-6582