Every Seller Underestimates Closing Costs. Here’s What the Number Really Looks Like.

You priced your home. You know your mortgage payoff. You did the math on your “net.”

Then you got the closing statement and the number was smaller than you expected.

Welcome to the club.

Every seller underestimates closing costs. Not by a little. By thousands. Sometimes tens of thousands. And it is almost always because they counted the commission and nothing else.

Let me walk you through what the real number looks like.

I am Allison Mireau with Real Connect Group.

Why the math is almost never what you think

Sellers run a simple calculation in their head.

• Sale price

• Minus mortgage payoff

• Minus commission

• Equals net

That is not how it works.

There are 8 to 12 separate line items that come out of your proceeds. Each one is small on its own. Added together, they shift the net by $15,000 to $40,000 depending on the state, the price, and the deal.

The surprise is not that costs exist. The surprise is how many there are.

The real line items at a Staten Island closing

Let me break down what actually comes out.

1. Commission

• Listing side and buyer side

• Negotiated at the listing agreement

• Largest single line item in almost every deal

This is the one you expected. Everything after this is what sellers forget.

2. NY State transfer tax

• $4 per $1,000 of sale price in NY State

• On a $700,000 sale, that is $2,800

• Paid by the seller in almost every SI deal

3. NYC transfer tax (for sales inside NYC, which includes Staten Island)

• 1 percent on sales under $500,000

• 1.425 percent on sales $500,000 and above

• On a $700,000 sale at 1.425 percent, that is $9,975

NYC transfer tax alone can be larger than most sellers’ entire “miscellaneous” estimate.

4. Attorney fees

• SI deals use attorneys on both sides

• Typically $1,500 to $3,000 for the seller

• Higher for complex transactions, estates, or two-families

5. Mortgage payoff and recording

• Loan balance plus accrued interest to closing day

• Payoff statement from your lender

• Satisfaction of mortgage recording fee

Watch for prepayment penalties on older loans. Rare now, but check.

6. Title clearance costs

• Any judgments, liens, or title issues must be cleared

• Open permits closed out

• Can run anywhere from $0 to $5,000+ depending on the file

7. Buyer concessions

• Closing credits negotiated at offer or inspection

• Repair credits

• Appliance credits

• Any seller-paid buyer closing costs

Concessions reduce your net dollar for dollar. If you gave $10,000, your net drops $10,000.

8. Pro-rated property taxes

• Taxes owed through the closing date

• SI property taxes come out of proceeds for the current period

• Can run $2,000 to $8,000+ depending on timing

9. Pro-rated utilities and HOA (if applicable)

• Oil tank fuel left in the tank

• Water bill through closing

• Condo or HOA fees prorated

10. Judgments, child support liens, or IRS liens (when applicable)

• Any public judgments against the seller

• Must be cleared at close

• Comes directly out of proceeds

11. Buyer-side credits for repair items from inspection

• Separate from original concessions

• Negotiated after inspection

• Deducted at close

12. Miscellaneous fees

• Wire transfer fees

• Overnight courier fees

• Mortgage satisfaction recording

• Small but they add up

The real line items at a NJ closing

NJ math is different.

1. Commission

• Same framework, negotiated at listing

2. NJ Realty Transfer Fee (RTF)

• Sliding scale based on sale price

• On a $750,000 sale, roughly $6,250

• On a $1,000,000 sale, roughly $9,575

• Paid by the seller

3. Mansion Tax (buyer-paid, but affects deal structure)

• 1 percent on NJ sales over $1,000,000

• Technically paid by the buyer

• Often negotiated as a credit, which shifts cost back to seller

4. Attorney fees

• Attorney review period is built into NJ contracts

• Typical seller legal fees $1,500 to $2,500

5. Mortgage payoff

• Same framework as SI

6. Property tax prorations

• NJ property taxes are high and prorated carefully

• Quarterly tax schedule, so timing matters

• Can be $3,000 to $12,000+ depending on timing and town

7. Title and judgment clearance

• Same framework

8. Concessions and inspection credits

• Same framework

9. Miscellaneous closing fees

• Same framework

NJ closings are cleaner in one way (no NYC transfer tax) but pricier in another (high property tax prorations).

What the real net looks like on a sample SI deal

Let’s run a realistic $750,000 SI sale.

• Sale price: $750,000

• Minus mortgage payoff: $350,000 → net $400,000

• Minus commission (say 5 percent total): $37,500 → net $362,500

• Minus NY State transfer tax: $3,000 → net $359,500

• Minus NYC transfer tax (1.425 percent): $10,688 → net $348,812

• Minus attorney: $2,500 → net $346,312

• Minus title clearance: $1,500 → net $344,812

• Minus tax proration: $4,000 → net $340,812

• Minus concessions (negotiated): $8,000 → net $332,812

• Minus misc fees: $500 → net $332,312

You expected $362,500. You walked away with $332,312. That is $30,188 less than your “net” estimate.

Not because anything went wrong. Because every line item was real.

What the real net looks like on a sample NJ deal

Same framework for a $750,000 NJ sale.

• Sale price: $750,000

• Minus mortgage payoff: $350,000 → net $400,000

• Minus commission (say 5 percent): $37,500 → net $362,500

• Minus NJ Realty Transfer Fee: $6,250 → net $356,250

• Minus attorney: $2,000 → net $354,250

• Minus title clearance: $1,000 → net $353,250

• Minus tax proration: $6,500 → net $346,750

• Minus concessions: $5,000 → net $341,750

• Minus misc fees: $500 → net $341,250

NJ nets slightly higher on this comparison because of no NYC transfer tax. But property tax prorations run bigger. The gap is smaller than most sellers assume.

Where sellers get the biggest surprises

Surprise 1: NYC transfer tax

• Most SI sellers forget this exists

• At $500,000+, it jumps to 1.425 percent

• $7,000 to $15,000 line item on most SI sales

• Not a fee you negotiate away

Surprise 2: Property tax prorations

• You owe taxes through closing day

• Timing of close vs tax billing cycle matters

• Can be a huge line item in NJ

Surprise 3: Concessions you forgot about

• The $8,000 you agreed to at inspection

• The $3,500 credit at offer

• The appliance package you included

• All deduct from your net

Surprise 4: Title clearance costs

• Open permits from past work

• A survey that revealed an encroachment

• An old judgment you forgot about

• All must clear before title transfers

Surprise 5: Attorney add-ons

• Base attorney fee covers standard work

• Complex closings add hourly time

• Estate sales, two-families, title issues add up

Surprise 6: Mortgage payoff interest

• Interest accrues to the day of closing

• Delays in closing add interest

• Payoff is higher than your current statement balance

The honest conversation to have at listing

Before you list, you should know:

• Approximate commission (negotiated at listing)

• Transfer tax estimate (based on list price)

• Attorney estimate (ask your attorney)

• Mortgage payoff estimate (call your lender)

• Realistic tax proration (depends on close date)

• Potential concessions reserve (budget $5,000 to $15,000)

• Title and misc buffer (budget $2,000 to $5,000)

Build the full picture before you set your price. Not after you get the closing statement.

What good Realtors do before you list

• Run a net sheet at the proposed list price

• Run it again at a realistic sale price

• Run it again with likely concessions baked in

• Explain each line item before you sign

• Update the net sheet when offers come in

If you listed without seeing a net sheet, you listed without full information.

The three things that most protect your net

1. Priced right

• No reductions means no reduced sale price

• Reductions are the biggest net killer most sellers never calculate

• A $750,000 home that reduces to $710,000 costs you $40,000

2. Pre-inspected

• Fewer inspection surprises means fewer concessions

• Fewer concessions means more net

3. Clean title and permits

• Open permits closed before listing

• Judgments cleared early

• Reduces title clearance costs at close

Three decisions before listing can save you $10,000 to $50,000 at closing.

What I will not pretend to advise on

I am not an accountant or an attorney. For specific tax impact of your sale proceeds (capital gains, cost basis, exclusions), talk to your CPA. For specific legal costs and title clearance, your attorney will give exact numbers. I can refer trusted ones on both sides of the bridge.

All of our work follows the Fair Housing Act, RESPA, the NAR Code of Ethics, and the real estate commission guidelines for New York and New Jersey.

Before you sign the listing agreement

Ask for a net sheet.

• At list price

• At realistic sale price

• At worst-case concessions

Know the real number. Not the one in your head.

Have questions about selling your home or relocating? Reach out to Allison today.

Call: 646.266.0188
Email: [email protected]
Website: www.statenislandtonewjersey.com

Contact Allison today to sell your home in SI.