Closing a sell in Canada

How to create outlook signature

are you selling a home and wondering what your closing costs are going to be and how much you're going to net it's really important to know these calculations up front so you're not surprised later on I'm Jennifer Hernandez alone with Jen welcome to my channel where I've got over 400 videos real facts no BS about everything mortgage let's get started first off it's important to know that when you're selling your house every state is a little bit different so just be aware you want to confirm these numbers with your local realtor or your local lender to make sure that you know what applies to you if you're using a realtor you should expect to pay an average of six percent for their commission for selling the house now half of that usually goes to the buyer agent that brings your buyer and the other half will go to the listing agent there's a lot of benefits to using a realtor so we're going to put a video down in the description on you can view later the benefits to have someone supporting you next you're going to have title and legal fees so again this is where a lot of States really differ there might be different taxes different type different fees title companies some states require attorneys so again just make sure that you check with someone in your state to make sure that these numbers are accurate but in general I'm going to use one percent of the price as title fees legal fees all that good stuff so here's the math so total fees that we have so far is six percent for the Realtors and one percent for title Etc so that's a total of seven percent let's say your home price is five hundred thousand dollars so if you reduce that by seven percent you're gonna take five hundred thousand and you're gonna times that by 93 that's going to equal 465 000 but wait there's more you also need to subtract your portion of the property taxes year to date to credit to the buyer so let me explain to you what that means let's say that your property taxes are ten thousand dollars a year so you want to subtract your portion of the property taxes year to date because that has to be credited to the buyer at the time of closing now I know that you're probably wondering Jennifer I ask where my taxes and insurance that's already going to be taken care of actually that's not true the thing is is that your current mortgage company can't have Community doesn't have communication with the current buyer so everything needs to be settled at the time of closing so don't worry you're going to be refunded your escrow later about 30 days down the road after your loan is paid in full so let's get back to the calculation so let's say that your property taxes are ten thousand dollars a year if you divide that by 12 that's 833 dollars per month now hey hang on with me if you're in March and you're selling your house in late March you've got to give the buyer three months of taxes so you take three months times your prorated tax amount which is 833 dollars and you get two thousand four hundred and ninety nine dollars we're just going to round that up to twenty five hundred so you would actually deduct that 2500 from your proceeds for this calculation and then after you do that you've got to subtract your actual mortgage loan I usually round up the amount on my mortgage statement to accrue for any unpaid prepaid interest that might be due when I get the payoff you can probably also obtain the payoff from your lender by logging in online and there's usually a button that says request payoff but the title company or attorney is going to do this as well right before closing the last thing to remember is that if you have any like water softener liens or if you had solar panels you might have a lien on your property and it's going to have to be paid when you sell your homeowners association might have some past dues that are due so make sure you know if you're caught up on those you want to also make sure that if you ever had a home equity or a home improvement loan that is going to be due when you sell as well so if you mesh all these things together and you subtract them from your five hundred thousand dollars you're going to come up with your net cash to close so in summary you take your sales price minus the seven percent so we got there by timesing it by 93 percent minus your loan minus your tax proration depending on what month you're selling in and then you want to subtract from that any miscellaneous liens that might be on title Like Home Improvement loans home equity utility liens like solar panels or water softeners and there you have it let me hear your questions I would love to know what you're thinking please keep tuning in talk to you soon