Selling a home is a big financial decision, and understanding the costs involved is key to being prepared. Whether you're selling on your own or working with an agent, it's important to know what fees to expect—and which ones are negotiable.
Here's a detailed breakdown of the most common seller fees in a real estate transaction:
This is typically the largest cost associated with selling a home. It usually ranges from 5% to 6% of the final sale price and is split between the listing agent and the buyer’s agent.
How commissions are negotiated:
The seller's agent negotiates their commission before you sign the listing agreement.
The buyer's agent negotiates their commission within the purchase agreement when the buyer submits an offer.
Important: Commission rates are negotiable. Neither the seller's agent nor the buyer's agent is guaranteed a set percentage.
Title insurance protects the buyer from title-related issues such as unpaid taxes, liens, or disputes over property ownership. In Michigan and many other states, the seller typically pays for the owner's policy.
Estimated Cost: $500–$1,500+
These are fees charged by the state and county to legally transfer property ownership.
In Michigan:
State tax: $3.75 per $500 of sale price
County tax: $0.55 per $500 of sale price
Example: On a $300,000 home, transfer taxes would total approximately $2,580.
Sometimes a seller agrees to contribute to the buyer's closing costs. This is often used as a negotiating tool to help close the deal, especially if the buyer is financing most of the purchase.
Amount: Varies depending on what is agreed upon in the offer.
While not always required, hiring a real estate attorney is recommended for FSBO sales or complex situations. An attorney can help draft or review contracts, disclosures, and attend closing if needed.
Estimated Cost: $300–$1,000+
At closing, your mortgage lender will be paid off directly from the sale proceeds. If there are any additional liens on the property (e.g., a home equity loan or contractor lien), those will also be paid at this time.
Sellers are responsible for their share of property taxes and utilities up to the closing date. These amounts are calculated daily and adjusted on the final settlement statement.
Offering a home warranty can help make your listing more attractive, especially if the home has older systems or appliances.
Estimated Cost: $400–$700 for a one-year policy
Buyers often request repairs or credits after a home inspection. Sellers can agree to fix the issues, offer a price reduction, or credit the buyer at closing.
Amount: Varies based on the findings and negotiations.
These fees cover the services of the title company or attorney handling the closing. They prepare legal documents, manage escrow accounts, and record the deed with the county.
Estimated Cost: $300–$600
Many real estate brokerages charge a separate brokerage transaction fee, sometimes referred to as an admin or compliance fee. This is a flat fee charged in addition to the agent's commission and is meant to cover internal office processing and file handling.
Typical Fee Range: $200–$600
At Bay Realty Michigan, we never charge a broker transaction fee to our sellers. This is part of our commitment to transparent and client-friendly service.
Be sure to check with the brokerage you are using to confirm whether a transaction fee will be applied.
| Fee | Estimated Cost |
|---|---|
| Real Estate Commission | 5%–6% of sale price |
| Title Insurance | $500–$1,500+ |
| Transfer Taxes | ~$8.60 per $1,000 of sale price |
| Seller Concessions | Varies |
| Attorney Fees | $300–$1,000+ |
| Mortgage Payoff / Liens | Based on balances owed |
| Pro-Rated Taxes & Utilities | Varies with closing date |
| Home Warranty | $400–$700 |
| Repairs / Inspection Credits | Varies |
| Closing / Settlement Fees | $300–$600 |
| Brokerage Transaction Fee | $0 with Bay Realty Michigan (varies elsewhere) |
Want a customized breakdown for your property? Reach out anytime — we’re happy to help!