Figure out If You’re Going to Gain or Lose Money with Villa for Sale in Rwanda
Author : Daniel Marley | Published On : 08 May 2021
What if you sell your home for more than you owe in your loan? Congratulations to you if you are already asking this question to yourself. Villas for Sale in Rwanda offers more than the value of your mortgage, and you'll able to get a nice profit.
But it doesn't occur always. Sometimes, a home sales price is higher than the mortgage amount owed, and a seller may not get a profit and choose to owe money instead. Here's how you can get to know if you're going to make or lose money while selling your home.
Where do your profits go while making the deal?
During your House in Rwanda closing, the final process is to swap your house keys for a check, which is a traditional method to handle transferring funds from buyers and sellers. It might be an escrow company, an attorney, a real estate agent, or a title company, depending on where you live, but they take the buyer's money and use it to pay off the seller's mortgage.
The check doesn't go directly to a seller's pocket. Many other parties should be paid off first. Here is some cost that can reduce your profit.
Real estate agent commissions
Firstly, the seller's real estate agent takes a commission and the buyer's agent.
Usually, the commission of the seller's agent is about 5% to 6% of the sales price of the house, and it will be outlined in the listing agreement, the document you signed when you hired the sales agent to sell your house.
Traditionally, the company of the lawyer who handles your closing will get the check directly. The Houses for Rent in Rwanda agent will split the money with the buyer's agent and have a secured deal.
In case you don't have sufficient cash to pay your agent, you'll need to opt for the check process at closing to make up the difference.
The buyer normally pays most of the closing costs, and the seller pays a few closing costs. These costs can amount to about 1% to 3% of the house's purchase price. Recording fees, title insurance premiums, and other fees come out of the sales price of the home; the buyer pays this to the seller as part of closing.
These fees are paid during the process of selling, so it comes from the money left over after you have paid for your mortgage.
After the agents get their part of the money and closing fees are settled, the extra taxes that you owe on the property will be levied. In most states, taxes are paid yearly in arrears. For example, the real estate taxes paid in 2019 are the taxes on the property of the year 2018. The buyer is not responsible for paying off the taxes that you owed you, and you'll have to pay those taxes.
Some states also levy transfer tax when the property is sold, which has to be paid by the seller out of the price of the home.
Anything left? It’s yours!
After you paid your loan, the agents get paid, and the fees and taxes are then settled, and if any additional amount is leftover, you can keep it. The money can either be paid by check or straight into your account, and you can check that.