Closing Costs

The closing is the culmination of the contract. All contingencies should be satisfied. The buyer performs a final walk through of the home and then meets with their attorney to sign the various mortgage documents. The buyer and seller meet for the transfer of title. The seller’s sign the required documents to sell the home. Both buyer and seller sign the closing statement indicating agreement to the dollars and cents, which authorizes the settlement agent to disburse the funds. The Seller then celebrates a new page in their life.

Typical Seller Closing Costs:
(Estimated)

  • Recording Costs: $200
  • Legal Fees: $1,850
  • Real Estate Commission: $4.5 to 6 % of sales price

Real Estate Transfer Tax:

Sales Price $350,00 or less

  • 2.00/$500 of consideration not in excess of $150,000
  • 3.35/$500 of consideration from $150,000 but not in excess of $200,000
  • 3.90/$500 of consideration in excess of $200,00, but not in excess of $350,000

Sale Price of $350,000 or more

  • 2.90/$500 of consideration not in excess of $150,000
  • 4.25/$500 of consideration from $150,000 but not in excess of $200,000
  • 4.80/$500 of consideration in excess of $200,00, but not in excess of $550,000
  • 5.30/$500 of consideration in excess of $550,000, but not in excess of $850,000
  • 5.80/$500 of consideration in excess of $850,000, but not in excess of $1,000,000
  • 6.05/$500 of consideration in excess of $1,000,000

There are partial exemptions from the real estate transfer tax for qualifying senior citizens aged 62 or older, blind persons, disabled persons; and on property that is low and moderate income house. There may also be full exemptions in different situations, such as parent to child.

2% Estimated Income Tax:

In some situation a seller may be required to pay an estimated income tax equal to 2% of the sales price. Exemptions include being a resident tax payer of the State of NJ, or qualifying for free capital gains pursuant to the IRS Tax Code.