Are you thinking about selling land in Montgomery County? If so then you might be wondering this common question: who pays when selling land in Montgomery County. In this article, we’ll reveal the surprising answer.
When people think of selling land, they think of handing over the deed and accepting a check for the property. Makes sense. At first you might think that the buyer pays the seller. But that’s not really how it works and you might be surprised at who pays when selling land in Montgomery County…
- Seller’s Responsibilities: As the seller, you will have certain financial responsibilities during the land sale process. Here are the key aspects to consider:
a. Real Estate Agent Fees: Typically, the seller hires a real estate agent to market and sell the land. The agent’s commission is usually a percentage of the sale price, agreed upon in the listing agreement. This fee is typically deducted from the proceeds of the sale.
b. Property Taxes: The seller is responsible for paying any outstanding property taxes accrued until the date of closing. It’s crucial to settle these obligations before transferring ownership to the buyer.
c. Title Search and Title Insurance: As the seller, you may be responsible for ordering a title search and providing title insurance to the buyer. A title search ensures there are no legal disputes or liens on the property, while title insurance protects the buyer against any future claims or defects.
d. Repairs and Inspections: In some cases, the seller may be required to address repairs or conduct inspections as part of the sales process. These expenses typically fall on the seller’s side unless otherwise negotiated with the buyer.
- Buyer’s Responsibilities: The buyer also has financial obligations when purchasing land in Montgomery County. Here are the key expenses the buyer typically covers:
a. Purchase Price: The buyer is responsible for paying the agreed-upon purchase price for the land. This amount is negotiated between the buyer and seller and specified in the purchase agreement.
b. Closing Costs: Buyers are generally responsible for paying various closing costs associated with the land purchase. These costs may include appraisal fees, survey costs, attorney fees, loan origination fees (if applicable), and other related expenses.
c. Recording Fees and Transfer Taxes: When transferring ownership, the buyer typically covers the recording fees and any applicable transfer taxes. These fees vary depending on the location and local regulations.
d. Financing and Interest Costs: If the buyer is financing the land purchase, they are responsible for any associated financing costs and interest payments. This includes loan application fees, appraisal fees, and interest accrued during the repayment period.
If you’re the seller, you’ll have to pay first! You’ll probably have to pay for a survey or a site analysis, or for a geologist to look at your property and tell you what potential it has.
Then you’ll work with a real estate agent to try and sell the property. There will probably be additional expenses that you’ll have to cover while the agent tries to find a buyer. For example, you’ll have to pay any mortgage, bills, taxes, and insurance on the property in the months that the agent is looking for a buyer.
When an agent finds a buyer, then you may need to work with a lawyer, a title company, and potentially others as well to complete the paperwork. Yes, YOU are paying for all of this the entire time.
Once the paperwork is complete, you will get the money for the property – after your mortgage is paid off and any liens are taken care of). That money might either come from the buyer themselves (if they’re paying cash) or it might come from the buyer’s bank (if the buyer had to get a mortgage to buy the properties).
But your paying is not over yet! Once it’s all said and done, you’ll also have to pay the agent’s commission… and that typically comes out of your pocket.
So, to answer the question, “who pays when selling land in Montgomery County,” the answer is that you’ll pay over and over and the buyer or their bank will pay you once.
A lot of sellers are realizing that this is not the best way to sell, especially if you don’t have the cash in hand to cover those expensive up-front costs. Sure, it’s nice to gamble on the possibility of getting a higher selling price (although you might not get what you’re asking for the land); it’s no wonder why so many sellers are looking for a faster way to sell land – by getting a fast cash offer and bypassing all of the costly and complicated steps, above.