Can sellers and buyers negotiate closing costs? The short answer is “yes,” they may negotiate closing costs.

The amount that the seller is allowed to contribute depends on the type of mortgage loan. The seller’s willingness to pay the buyer’s closing costs may also be based upon current real estate market conditions.

For example, in a seller’s market (like we are in now, with less inventory and more buyers), buyers might have to increase their purchase price if they expect to receive closing cost assistance.

In a buyer’s market (slow real estate sales with more homes available and fewer buyers), buyers might  have an advantage in negotiating closing costs.

Closing costs are expenses above and beyond the price of the property that sellers and buyers incur that are paid to title companies, attorneys, lenders, insurance companies, local government, and other vendors when transferring ownership of a property. 

For buyers paying cash, closing costs might include attorney fees, title search, title insurance, deed recording and applicable taxes and association fees.

There are additional buyer fees when using a lender and obtaining a mortgage. They include origination fee, appraisal fee, flood insurance, credit report, interest on loan until first payment is due, escrow  for taxes and insurance, lender’s title insurance and mortgage recording.

Other fees might include homeowner’s insurance, interest rate buy-downs, home warranty, home inspection, and repairs that are requested and/or required.

Typical seller closing costs (which are deducted from seller’s proceeds) can include attorney’s closing fee,  government transfer tax, pro-rated taxes and association fees, mortgage payoff, liens on property (if any), recording costs and real estate commissions.

Note 1: While most, if not all, closing costs are negotiable, restrictions might apply under certain circumstances.

Note 2: Money might have to be brought to the table if the amount of the seller’s closing costs is more than the seller’s proceeds.

Note 3: Real estate commissions are paid by the seller for compensating both the listing agent and the buyer’s agent.

Experienced and knowledgeable real estate agents (and real estate attorneys) will be able to explain to their sellers and buyers what closing costs they will be expected to pay when selling and/or buying a resale home or building a new home.

Do you have questions about negotiating closing costs? Consult your agent, attorney or email me.

Larry Stoller is a broker and Realtor with Real Estate Five of the Lowcountry.,,