Understanding Closing Costs in a Real Estate Transaction

When buying or selling a home, one of the most common surprises for clients is the list of fees that appear at the end of the process — the closing costs. At Bold City Realty Group, we believe that understanding these costs upfront helps you feel confident and prepared when it’s time to sign on the dotted line.

Let’s break down what closing costs are, what they include, and how you can plan for them.

What Are Closing Costs?

Closing costs are the expenses you pay at the end of a real estate transaction, in addition to the purchase price of the home. They cover the services and administrative tasks required to finalize the sale and transfer ownership.

While both buyers and sellers have closing costs, they can differ in type and amount.

Typical Closing Costs for Buyers

For buyers, closing costs generally range from 2% to 5% of the home’s purchase price. Common fees include:

• Loan Origination Fees – Charged by your lender for processing your mortgage application.

• Appraisal Fee – The cost of having a professional determine the home’s value.

• Home Inspection – An optional but highly recommended step to ensure the property is in good condition.

• Title Search & Title Insurance – To verify legal ownership and protect against future disputes.

• Recording Fees – Paid to the local government to record the sale.

• Prepaid Costs – Such as property taxes, homeowners insurance, and mortgage interest.

Typical Closing Costs for Sellers

Sellers’ closing costs can range from 6% to 10% of the sale price, with the largest portion usually going toward the real estate agent commission. Other common seller expenses include:

• Title Insurance (Owner’s Policy) – Protects the buyer against title issues.

• Prorated Property Taxes – The seller pays for the portion of the year they owned the home.

• Outstanding HOA Fees or Liens – Must be settled before closing.

• Attorney Fees – If applicable in your state.

Who Pays What?

While certain costs are traditionally assigned to either the buyer or seller, many of them are negotiable. For example, in a competitive market, a seller might agree to pay part of the buyer’s closing costs to help seal the deal.

At Bold City Realty Group, we help our clients understand where they can negotiate to save money and keep the transaction moving smoothly.

How to Prepare for Closing Costs

The best way to avoid last-minute stress is to budget for closing costs early in the buying or selling process.

For buyers: Ask your lender for a detailed Loan Estimate so you can plan for the exact amount.
For sellers: Your real estate agent can provide a Seller Net Sheet to estimate your proceeds after costs.

The Bottom Line

Closing costs are a standard part of any real estate transaction, but with the right guidance, they don’t have to be a mystery. By understanding what’s included and planning ahead, you’ll be ready for a smooth and stress-free closing.

At Bold City Realty Group, we’re here to guide you through every step of the process — from your first showing to handing over the keys. If you’re buying or selling in Jacksonville or the surrounding areas, let’s talk about how we can make your next closing seamless.