“What are common closing costs in Massachusetts?” This is perhaps the most common question we get from prospective buyers and sellers. Every transaction is different, so the question is not always easy to answer. However, there are some standard fees that one should expect. Read our list!
Massachusetts Buyer Closing Costs
- Recording Fees —Various documents are recorded at the Registry of Deeds at closing. The Commonwealth currently charges (as of September 2022) the following amounts for the following documents:
- Deed – $155Mortgage – $205Municipal Lien Certificate – $80Declaration of Homestead – $35
- Certificates and Affidavits – $105
- Plot Plan — If you are buying a house, as opposed to unimproved land, your lawyer will almost always order a plot plan from a local surveyor to ensure that there are no encroachments on the property. This typically costs between $350 and $500.
- Title Exam / Abstracting — Your lawyer will order the complete record of recorded documents pertaining to the property from the past 50 years from an abstractor. This typically costs between $300 and $400.
- Municipal Lien Certificate — This is the tax certificate that shows the exact amount of the property taxes and whether any taxes are owed. Towns and cities typically charge between $25 and $50 per certificate.
- Adjustments for Property Taxes — Property taxes are pro-rated, so you will pay the seller for any property taxes that have already been paid for the current tax period.
- Adjustments for Propane/Fuel/Heating Oil — Buyers must pay sellers for any propane or oil that is left in the tank(s). This is calculated based on the current price per gallon and a reading of the gauge a few days before closing.
- Title Insurance Policy — Title insurance protects owners and their lenders from financial loss resulting from a hidden defect in the title to a property. It is a one-time payment that covers homeowners for as long as they own the property. The payment is a factor of the purchase price of the property. Commonly, it’s calculated as $4.00 per every $1,000, but this can change for properties over $1 million and depends whether a lender’s policy is being issued simultaneously. You should ask your attorney to calculate this for you.
- Legal Fee — This can vary depending on the purchase price of the property, whether the buyer is getting a mortgage, and whether any special considerations are involved.
- Bank Fees — If you are getting a mortgage, the lender will charge various additional closing costs. These can vary greatly between lenders. Typical bank fees include underwriting fees, appraisal fees, credit checks, and rate lock fees. Your lender will provide you with a loan estimate when you apply for your mortgage.
- Homeowner’s Insurance — The premium for the first year is usually paid at closing and can be included in your closing costs. If you are getting a mortgage, your bank will require this to ensure that the home will be insured as of the closing date.
- Buyers do NOT pay realtors’ commission.
Massachusetts Seller Closing Costs
- Commission to Realtors — If you are using a realtor, you will have an agreement with the realtor stating the rate of their commission. This is almost always a percentage of the sale price. A listing agent typically splits the commission with the buyer’s agent.
- Recording Fees — Sellers do not pay to record the deed, but occasionally a seller must record a document at closing, such as a trustee certificate, easement, agreement or affidavit.
- Transfer Tax (“tax stamp”) — Sellers in Massachusetts are required to pay a “tax stamp” when they sell property. The tax is currently set as $4.56 per every $1,000 of the sale price.
- Unpaid property taxes, HOA dues, water/sewer bills.
Want more information on buying and selling homes in Massachusetts? We think you’ll find our our downloadable guides of interest. Click on the images below for The Purchase and Sale Agreement and Realtors, Attorneys, and the Contract.
About Lazan Glover Puciloski, LLP
Lazan Law has overseen thousands of closings over our 35 year history. And we’ve never been busier! We most frequently work with home buyers and sellers in the Berkshires: Alford, Great Barrington, Hancock, Lee, Lenox, Monterey, North Adams, Pittsfield, Richmond, Sandisfield, Sheffield, Southfield, Stockbridge, South Egremont, Tyringham, West Stockbridge, and Williamstown, as well as communities beyond the Berkshires.
Contact us if you’re about to embark on a home buying journey!
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