|Posted on January 24, 2020 at 6:25 PM|
Whether you are in the process of buying or selling a property, you will inevitably have to deal with closing costs. And the best way to do so is to know exactly what you are up against. For this reason, we have listed everything you need to know about closing costs in Florida. After going through these points, you will be well-informed and ready to tackle this important real estate element.
The amount you will have to pay for them varies from state to state. When it comes to closing costs in Florida, the final price will depend on both the property and the county it is located in. However, as a buyer, know that you will have to cover most of the fees and taxes. Based on the latest statistics, you can expect to pay from 1.89% to 2.79% of the total purchase price before taxes.
Regarding the average closing costs in Florida
You can expect that the average closing costs in Florida will be 1.98% of the purchase price. At first, this may not seem like much. Howbeit, you ought to be wary. The amount you have to pay can quickly enlarge, especially if you are purchasing an expensive home. Namely, across the state of Florida, the average home costs somewhere between $200,000 and $300,000. So, if you buy a property in that range, you should expect to pay between $1,620 and $2,430 in closing costs before taxes. As you can see, these amounts are not to be underestimated or neglected, especially if you want to have a stress-free relocation to another city. You should also know that the things you are paying for through that amount include accounts for appraisal, settlement and recording fees, along with title insurance and flood certification. The latter is required by the state.
Additional fees that concern you include a fee for documentary stamps (doc stamps), which is a percentage of the sales price, as well as taxes. The ones that you are most likely to be a subject of are property and transfer taxes. After you have added those as well, your closing costs would approximately be $5,585.
Who needs to pay closing costs in Florida?
The closing costs in the State of Florida are divided between the buyer and seller. However, it is not an even split. Namely, the buyer is the one to handle the bulk of the fees and taxes. Still, the closing costs tend to slightly vary between counties. Whether you are buying or selling, it is highly recommendable that you have a real estate agent to guide you through the process. Know that you can always turn to us, as we connect buyers and sellers of real estate throughout the U.S. with a top real estate agent to rebate them back 15% of their commission.
How do Florida closing costs compare to the other states?
Florida ranks as the 16th out of 50 states for average closing costs before taxes. This makes the costs among the highest ones. Buyers and sellers in California, DC, and New York have it the worst. On the other hand, Iowa, Missouri, and Nebraska have the lowest closing costs. Take this into consideration if you plan on moving to any of these states. While the help of movage-moving.com will make the relocation easy and swift, it is the aftermath that you will have to think of.
What if you want to buy a condo or co-op in Florida?
Before we delve into the details of this process, we would urge you to think about finding a real estate agent to help you out. And, with Top Agent Rebate, you will have your back covered.
Buying a condo
It is necessary that you qualify for a mortgage prior to purchasing a condo. After you have bought an individual condo, you’ll receive a real estate deed and be held accountable for paying property taxes. Know that condos are regulated by the Florida Condominium Act, while the legislation lays out your rights to the property. It also gives you an “undivided interest” in all the common areas of the building. This means that you will have to pay a monthly maintenance fee or a yearly homeowners association fee. Its purpose is to cover the servicing that regards the areas that are classified under the “undivided interest”. Whichever fee you get to pay, know that it isn't tax-deductible.
The most important thing to understand regarding this sort of investment is that you won't own that physical piece of property. What's more, the best way to describe it would be to say that you are buying into a co-op. To put it simply, you will become a shareholder in the corporation that owns the building. In return, you will get an exclusive leasehold on your unit.
It is safe to say that the large your co-op unit, the more shares you own. In order to finance the purchase of a co-op, you will need to take out a home loan instead of a mortgage. Mind you, a mortgage is a loan that is secured with your property. As the borrower owns the property, he has to pay it off over time. With home loans, however, the lender advances the funds to purchase the property in full.
It is important noting here that the co-op ownership documents in Florida are not consistent across properties. This tends to cause confusion and make the closing on co-ops much more challenging. In certain cases you as the owner will simply get stock in the building. In others, however, you will get stock as well as a proprietary lease, or an “occupancy agreement.
What it comes down to
Closing costs in Florida can vary depending on where you live, the type of property you buy and how much it sells for. While the sellers tend to pay more than they are happy to, the buyers are the ones to cover the bulk of the fees and taxes. And these typically add up to 1.98% of the average sale price.
Written by: Lisa Robert with US Moving Experts