Are you selling a home only to discover that the process comes with various closing costs? Whether it’s repair costs, real estate commission, or property taxes, these costs can quickly add up and catch you if you didn’t expect them.
Luckily, homeowners can usually avoid home sale fees by selling to cash home buyers in Wisconsin instead of through a real estate agent, lowering some of the closing costs.
So, precisely how much does it cost to sell a house in Wisconsin? How can you avoid paying additional fees that eat away at your share of the sale price? Read on to learn more.
Typical Costs When Selling a Home in Wisconsin
When using a realtor, home sellers typically pay a wide range of fees, including the agent commission, escrow fees, seller closing costs, recording fees, and more. So, how much does it cost to sell a house, and what expenses should you prepare for?
House Repair Costs
One of the most considerable selling costs you might face is the cost of home repairs. Most sales through a realtor come with an inspection contingency. That means the bank will require a professional home inspection to ensure the house is safe. More on that later, though.
In any case, you have to make sure the home is entirely liveable. If there are plumbing issues, for example, you need to fix them before selling the house. Some homes won’t have much to repair, while others might have severe structural damage, costing you thousands of dollars in renovations.
In addition, you might pay for other non-essential home improvements, like landscaping. For example, you might want to improve your curb appeal. That will help make it easier to sell the home, especially when advertising on online marketplaces. You could repave your driveway, for example, and plant bushes in front of your home to make it more visually appealing.
Home staging, which refers to making your home more visually appealing to potential buyers, goes beyond curb appeal. You might want to remodel your basement, for example, or install new windows.
Real Estate Commission
Every real estate transaction a listing agent facilitates will come with realtor fees. This fee also tends to be among the highest of all costs you will pay – it’s usually 5-6% of the purchase price, but it could be a little higher or lower depending on the selling price and the current real estate market.
Typically, the buyer’s agent gets half the real estate agent commission, while the seller’s agent gets the other half. Despite that, the seller pays the entire realtor commission in most cases.
Home Selling Lawyer Fees
You’ll also need to pay a lawyer to take care of the legal aspects of selling your Wisconsin home. Your lawyer can ensure that the contract doesn’t contain any clauses that might come back to bite you later. They will also ensure that you have made all the necessary disclosures per the law.
Some lawyers charge per hour, while others charge a flat fee. Depending on the lawyer, you can expect to pay at least $1,000 in attorney fees, though you may pay a few thousand more.
Selling through a realtor can take months. Potential home buyers will come to check out your home during that time. You’ll need to keep paying utilities throughout those months. For example, you’ll want the lights working, so buyers can see how it looks at night. You’ll need the AC on, so they get a good first impression.
Home Inspection Costs
In a traditional home sale, the lender will require a professional inspection to ensure the home is livable. After all, they’re giving out a loan on the home, and if the buyer can’t pay off their mortgage balance, the bank may need to repossess and sell the house. If the house has hidden damage, it’s not worth it for the lender’s bottom line.
Typically, the buyer pays inspection fees. However, getting your own home inspection is a good idea. That way, you won’t get any surprises later on. Home inspection fees can be anywhere from $200 to $500, depending on the size of the home.
There are also a variety of miscellaneous closing costs that can eat into your share of the home’s sale price. Here are the top ones to know about:
- HOA fees: Usually, you will pay a few hundred dollars or so in HOA transfer fees. The monthly national average is $200-$300.
- Title search: You should pay for a title company to conduct a search on your home. The company will sift through public records and ensure that nobody else has liens or claims to the property. That assures the buyer that you are the legal owner.
- Title insurance: You should take out an insurance policy on the title to protect the buyer from hidden liens that could interfere with their access to the property.
- Escrow fees: Escrow fees in Wisconsin are typically 1-2% of the purchase price. You pay them to the title or escrow company to handle the transfer of funds and the recording of the deed.
- Courier fee: The lender may charge a courier fee to transport the mortgage documents, although the buyer usually pays this fee.
Home Selling Capital Gains Taxes
You’ll have to pay capital gains taxes when you sell your home, just like any other asset. You may be able to deduct 30% first in Wisconsin. Tax law is complicated, so read the IRS publication on the matter or consult with a qualified tax professional. The tax professional may charge you an hourly fee for their services.
You’ll also have to pay a transfer tax of 30 cents per $100. You can read the whole statute here. While that might not sound like a lot of money, it can quickly add up.
Can You Avoid Some of These Costs?
Yes. You can avoid some of the costs above, but not all of them. For example, if you put up your home as FSBO (For Sale By Owner), you won’t have to pay any real estate agent commission. That can immediately save you 5% or more.
Here are some other fees you can avoid when you sell your home by yourself:
- Home inspection fees: If you’re selling to a cash buyer, they may inspect the home, but you may not have to pay for a thorough professional inspection. There’s no lender or mortgage involved.
- Home improvements: You can usually sell your home as-is when dealing with cash buyers. Yes, you can sell a house that needs repairs; simply lower the home’s overall price and have the buyer pay for those repairs.
- Utilities: Selling to a cash buyer takes much less time than selling through a realtor. That allows you to save money on utilities. You can even stop paying your utility bills altogether. Most cash buyers and house-flippers aren’t as picky as realtors.
Nevertheless, there are some fees that you simply can’t avoid, even when you put up your home as FSBO. For example, here are some expenses you must or should pay:
- Title search fees: You still have to reassure the buyer that there are no liens or claims on your home and that you have full rights to sell it.
- Title insurance: It’s also a good idea to take out a title insurance policy to protect the buyer.
- Taxes: You must still pay the transfer tax to the government.
- HOA fees: Your homeowners’ association may charge fees, irrespective of how you sell the house.
- Legal fees: It’s a good idea to enlist the help of a lawyer to sell your property. You don’t want any nasty surprises later on. However, it’s not essential.
- Escrow fees: You don’t necessarily have to use an escrow company, but it can help ensure the sale goes through smoothly.
So yes, you do have to pay some fees. However, the amount you will pay in fees when selling to a cash buyer is minuscule compared to what you’ll have to pay when selling through a realtor.
Your most significant expenses will always be home improvement expenses and the real estate agent commission, both of which you can avoid by selling to a cash buyer. We can help you sell a house fast in Oshkosh.
How To Avoid Racking Up Costs When Selling a Home
The best way to avoid racking up costs when selling a home is to sell to a cash buyer. Other than that, negotiate! If the real estate market in your city or town is hot, and if the price for the home is high, your agent might be willing to lower their commission by a few percentage points, saving you thousands of dollars.
If you are selling your house fast to a cash buyer, you may be able to get them to cover some fees, like the title search and title insurance costs, if you offer them a fair price and close the deal quickly.
So, how much does it cost to sell a house in Wisconsin? Selling your home comes with multiple fees, so you may end up getting less than what your home is worth.
However, if you sell to a cash buyer, you can avoid most of those fees and save thousands or even tens of thousands of dollars. We buy houses in Milwaukee, so get in touch with us to get started.