What are Third-Party Costs?
There may be expenses paid to others like inspectors or insurance firms, even if you paid cash for the property:
Title Search Costs – A Title Agency will perform or will arrange for the title search to ensure there are no obstacles such as liens or lawsuits regarding the property. Or you may work with a title company to verify a clear property title. Once the transaction is complete and the property has been transferred to you, you will receive a copy of the title policy insuring these findings.
Homeowner's Insurance – Most lenders require you prepay the first year's premium for homeowners insurance, sometimes called hazard insurance, and must show proof of payment at the closing. This insures that the investment will be secured even if the property is destroyed.
Real Estate Agent's Sales Commission – The seller pays the real estate agent's commission, and if one agent lists the property and another sells it, the commission is usually split. The commission is negotiable between the seller and the agent.
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