Paying cash only eliminates the costs related to mortgages- there are still a multitude of legalities that need to be covered by anyone purchasing a home. We paid cash for our new home a couple of months ago and still had to pay for the inspection, the insurance, title exam, title insurance, title insurance binder, document prep, and filing fees.

Your agent or attorney can tell you what to expect as far as costs in your state, plus there is a ton of info on the web. Don't go into a closing uninformed- you will have to look over all of your documents and make sure everything is correct. Devote a couple of days to studying the terms and what is what.
I've included a decent link- don't let the title fool you as it lists all sorts of closing costs and what they are. Some are mortgage related and some are not- scroll past the mortgage ones and read the others as they are what concerns you. There is also a link there about understanding your HUD-1 form, so hit that one as well.

Here is a link that might be useful: Closing Costs

We closed on our cash sale home on Monday, and it was exactly as cearbhaill said; it amounted to a tidy sum we had to pay in expenses. Ours came to $1,300. Ouch.

I was represented by a RE agent and so was the seller.

Great link!

downsouth, are you using an attorney?

downsouth - if you are selling your home in a soft market, chances are, the buyer will ask that you pay their closing costs. That is pretty standard nowadays.

In order to reduce the cost, if they ask for you to pay them, you can state that you will not pay their points (if they chose them) or prepays like property taxes - only the costs associated with their mortgage and escrow like title etc. I will not agree to full closing costs when selling if the person elected to pay 3 points to buy down to a lower rate. That is their choice and not something for which I will pay.

Paid cash in September. Like someone mentioned above.....the only difference in cost is what you would have paid to obtain a mortgage unless you have a buyer's agent...in that case, you will also owe their fee. To the owners who sold you the property....it's all cash to them anyway..either from your pocket or from your mortgage company's pocket. In our area, the buyer always pays for the title insurance. I think that varies from region to region. You're definitely gonna be paying less as a buyer than you will as a seller. Selling is the BIG TICKET one!

Keep in mind that an item that often pops up is how to divvy up the property and/or school tax levy for the current year.

In some areas the tax is paid forward for the year, in which case the seller will expect you to reimburse him for the portion of the taxable year still to come which he has already paid. In other areas the tax is paid for the previous year, in which case you, the buyer, should get some extra money from the seller to cover the period of the taxable year when they owned it, but haven't yet paid the tax due. When the tax bill comes you will have to pay for the entire taxable period, so obviously you should hang on to the funds to cover the period before your closing.

And of course, any and all of these fees can be negotiated between buyer and seller before closing.

BTW, even if not required (since you have no mortgage) you might do well to see what a title insurance policy would cost you. Title exam just looks at the obvious, usually very recent title issues, but title insurance covers the unobvious things and pays you to either straighten out defects on the title that appear somewhere down the road, or pays you for the monetary loss if you don't wind up having undisputed ownership of all the property enumerated in your deed.

In some areas the buyer pays the deed recording fee; in others it's just the opposite. And in many areas the seller may get hit with something called the real estate transfer tax (separate from any capital gains tax due.) The transfer tax is basically a plan to hit up the seller just at the moment when some money is moving his way. It is usually levied on the reported sale price (another reason it can be important not roll closing costs, furniture purchases, etc, into the agreed-upon selling price.) That won't affect you now, but will later when you sell your present house.

Your closing attorney will be able explain what's customary in your area and state.
Molly~

downsouth - if you are selling your home in a soft market, chances are, the buyer will ask that you pay their closing costs. That is pretty standard nowadays.

If you recall, she wasn't selling yet but was going to let her son live there for a while, then put it up or something like that. She was going to need a good 6 months.

Roselvr, we have a lot to do before we can put our current home on the market. With everything I am reading about the market being slow, we may wait until next spring before it goes on the market. We aren't in a big hurry.

Dreamgarden, we don't have an attorney. Hubby thought it was not necessary (I feel differently), but he said since it's a bank we are dealing with who owns the home, he feels better about it. I don't know what that has to do with anything, LOL.

Housekeeping, I have thought about a title insurance policy, but we personally know the people who lived in this home before we put in our bid and the situation.

roselvr - If you recall, she wasn't selling yet but was going to let her son live there for a while, then put it up or something like that. She was going to need a good 6 months.

Ohhh that's right. I didn't make the connection from the other thread! I just went by what she wrote in this one.

downsouth - sometimes when I disagree with my husband, I pull what we call "Executive Wifely Decision" or EWD for short. I don't pull it very often but I did when dh was sicker than a dog and planned to go into work. I kept him home for three days and if he had his way, he would have gone in on all of them. Nope. EWD! Same as when we were in FL on holidays, he drank beer earlier in the day, switched to scotch and then wanted to switch to Red Wine. EWD!!! I've heard him puke before from drinking, I know he's a light weight and I wasn't going to listen to him puke all night from mixing all that booze!

I think you need to pull that for the lawyer situation. Your dh is dead wrong about not needing one. Why not spend $500 for the peace of mind? EWD is your friend! ;) The key is not to use it except in extreme circumstances and the lawyer situation is definitely one of them!

Roselvr, we have a lot to do before we can put our current home on the market. With everything I am reading about the market being slow, we may wait until next spring before it goes on the market. We aren't in a big hurry.

Yes, I remember you said that you had work to do which was why you needed time.

"Executive Wifely Decision"

I love it!

Housekeeping, I have thought about a title insurance policy, but we personally know the people who lived in this home before we put in our bid and the situation.

Do you know ALL of the people who have owned the home and/or land on which it sits? Get a title policy AND an attorney. Don't be penny wise and pound foolish.

Terriks, we know the original owners (the only owners). It's only 7 years old.

"Terriks, we know the original owners (the only owners). It's only 7 years old."

I hope your trusting nature doesn't come back to bite you. Your house purchase is a business transaction, and you can bet the sellers are looking out for themselves more than they are for you.

I would never buy a house without an attorney and a title policy. That's just asking for trouble.

The property didn't just spring into existence 7 years ago. Who owned the land before that?

I agree, the title insurance is what would cover you if you discover that someone, several owners back, sold or gave an easement, or sold the mineral rights, or just plain fudged the property description. It's not about the most-recent owners, and in your case you're buying from a bank so there might be even more chance of something having fallen off the charts.

Molly

Its funny from my point of view listing to people complain about $1-$2K in closing costs.

I bought my first house 2 years ago. My closing costs were approx $13,000

There are few posts on this board that actually make me cringe.

This is one of them.

Yikes.