Selling a House - What Are Closing Costs?

Too many times I haven't seen a closing statement until the day a real estate closing is scheduled, or possibly the day before. When I receive it, by fax, by email or in person, I immediately make certain I have no distractions so that I can review it thoroughly. Reviewing a closing statement is a very, very important activity and I take it very seriously. Most of the time a closing statement is also called a HUD-1 form.

So, I'm suggesting that you close the door, turn off all your electronic devices and focus on the closing statement when it arrives because it will affect how much money you pay and how much you receive at the closing table when you sell a house. Don't just look it over, actually read it and make certain that you understand it, or go ahead and call the person who prepared the closing statement to ask questions. Call your real estate agent, too.

In the event that you have not seen your closing statement prior to closing, please take matters into your own hands and excuse yourself to another room in the building with the person who is closing the transaction for you. Sit down, look over the form and ask questions. Do not leave the private room until you understand everything thoroughly because it directly affects how much money comes out of or goes into your pocket. When you are comfortable with it, then it's time to return to the closing table. You are not causing a delay in this situation, I assure you. You are completely within your rights to demand time to understand the transaction, and you are supposed to have that time 24 to 48 hours prior to the scheduled closing.

When you are comfortable with everything on the closing statement, you will have a clear understanding of the phrase "closing costs." There are two types of closing costs, "non-recurring closing costs" and "pre-paid items," which are the items you pay only once as a result of this sale transaction, and the things you have been or will be paying routinely as a homeowner.

Closing costs when you sell a house are the expenses of closing a real estate transaction, and most people discover that the list is surprisingly long when they sell a house. You can look at a blank copy of the HUD-1 form online or get one from your real estate agent to familiarize yourself with the form so you'll have a better understanding of your anticipated closing costs before you close.


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Leo Kingston has 30 years of experience buying and selling homes as an investor in the Oklahoma City area. His company offers local home owners simple options when they need to sell a home quickly for cash.