Seller’s Closing Costs Explanation


Closing costs for sellers and buyers have many variables: state, county, lender, title insurance company, contract sales price, broker, and more.  Each and everyone has a different cost that has a variable and in that variable another variable.  Please understand this is being provided as a courtesy and in no way should you hold Joe Ollis Real Estate & Auction, LLC or its agent liable when your costs or fees are different then the contents of this explanation.


We are only going to use the State of Illinois.  If you are buying real estate or live in another state know that each state and county has their own laws and customs. Any of the following costs can be negotiated on the Contract for Sale of Real Estate to be paid by either the buyer or seller, we’ve organized it more traditionally for who pays for what.


The following are some basic closing costs explained for the seller.  Be AWARE that every single real estate transaction is different and no two are alike.


The contract sales price is the “gross price” for what you are willing to take for your real estate.  Personal property negotiated into the real estate sales contract does not have a value, as the personal property becomes part of the real estate.   If you want to sell other personal property not negotiated into the real estate contract it should be handled by a separate personal property contract or a bill of sale.


The closing fee is charged to coordinate the actual closing.  The base closing can average $300. Customarily the fee is split 50/50 between buyer and seller.  IF the buyer is getting a loan the seller should not have to pay a closing fee IF the bank is doing the closing.


Title insurance is based upon the contract price and is charged so much per thousand.  This price per thousand depends upon the company used.  For our example, below we’ll use $3.50 per $1,000.  The seller provides the buyer with an owner’s title insurance policy. 


The title search cost is for the research on the real property and the sellers.  To help the title company, your abstract or previous title policy should be provided before the work begins.  Cost for the search will vary, with a minimum of around $350.00.


Title Examination fees start around $350 and go up. This is for review of the findings of the title search.


The Title Insurance Binder is a commitment to issue an owner’s title policy.  The Binder will show what is necessary to issue clear title policy to the new buyer.  Cost is about $25


IL CPL is short for Illinois closing protection letter.  The CPL is provided by the title company and is taxed by the State of Illinois, seller pays $50.00, buyer pays $25.00 and lender fee $25 which is paid by the borrower.


IL Title Reg is short for IL Title Regulation.  The State of Illinois collects $3.00 for each policy written.  The seller pays for the Owner’s Policy; the purchaser, if they are borrowing, pays for the Mortgage Policy.  


The seller provides the buyer with a deed & PTax.  The deed conveys the land from seller to buyer.  The PTax record the price and amount of stamp taxes.  These are prepared by an attorney, with an average starting cost of $120.00.  It depends what attorney prepares the deed and how complicated.


Commission & Advertising is probably going to be your largest expense and will vary with company and price of real estate.  This will be negotiated when you list your property.  Normally commission is a percentage, be aware that in Illinois a minimum commission must be on the listing agreement.


State, County, & City Transfer Stamp Taxes are placed on the deed when recorded. State stamp tax is $1.00 per thousand.  County stamp tax $.50 per thousand.  Most towns in Southern Illinois do not have a city tax, but every single town is different.


The seller gives the buyer a credit for real estate taxes, on the closing statement.  Illinois real estate taxes are paid in arrears, your 2015 taxes were paid in 2016 and your 2016 taxes are paid in 2017.  Prorated real estate taxes are the previous year’s unpaid taxes and the current year up to the date of closing.  The amount prorated generally comes from the current taxes.  If the property is being changed somehow, the county assessor’s office can approximate the assessed property value and provide an amount.


Most properties being sold will not need a survey, because the legal description is not being changed.  Surveys are necessary when changing the legal description of real property.  The only people able to rewrite legal descriptions are surveyors.  Survey costs vary greatly, as it depends what is being surveyed and how it is being divided.  Most of the time sellers provide buyers with a survey, however sometimes the cost is split 50/50 between buyer and seller.


Your mortgage is recorded at the courthouse.  If you have paid your mortgage off, a release of lien should be recorded.  If your release is not recorded, you must request the release from the bank.  If you still owe the bank only you can get the payoff, unless the title company has signed written permission from you.  Also, the payoff will need to be figured for about a week after the set closing date, in case something happens.  If your bank collects money to pay for your taxes or insurance, it is up to you to find out if your payoff includes the amount or if your bank is going to send you the money.  Every bank is different and they will only tell you, because it is confidential information.


Liens against the real estate must be paid. Final payoff amounts will need to be obtained by you or written permission to the title/closing company.  Release of liens need to be sent to the closing company and they record them at the courthouse.  If you disagree with a lien or believe you can get it reduced, you or your attorney need to get it taken care of immediately.


To record anything at a county clerk’s office there is a fee, which is different in every county.  Most have a flat fee for a specific number of pages and then a per page fee after the specific number is reached.


If you cannot be at closing, then everything can be mailed or emailed to you.  Almost all the documents will need to be notarized and then overnighted back, by either UPS or FedEx, the closing company must have the originals.  Courier fee starts around $25.00.


The following is NOT what an actual closing statement looks like, we are only providing this so you can see a visual of the numbers.  Please remember almost all fees are not fixed, and we can help you with understanding this process. 








Contract Sales Price






Earnest Money












Title Insurance



Lender's Title Insurance



Title Search



Title Examination



Closing 50/50









IL Title Reg






Recording Deed



County Transfer Tax



State Transfer Stamps



Real Estate Tax 2016



Real Estate Tax Proration 01-01-17 thru 03-01-17






Recording Mortgage









Credit Report



Flood Certification



Wire Fee



Courier Fee






Total Credits



Total Charges



Grand Total




 I wanted to put this together because I believe in education and having resources.  I couldn't find basic closing costs anywhere; most were complicated, not enough information, or just put in your figures, we'll calculate it for you, get your email, and bother you.  My goal was to keep it simple and have the fees a little on the high side, that way when you get to closing, hopefully, it isn't as expensive as it is here.   One item I know will be a little cheaper is the title insurance policy itself as it has a graduating scale: 1st $50,000 is $3.50 per thousand, $50,000 to $100,000 is $3.00 per thousand and then it gets a little more complicated and every title company is different.  As you can tell $3.50 per thousand was easier to explain online and when you sit down with us we can explain that.  Coming up next, are two different buyer's closing costs explanations.  One is with a mortgage buyer and the other is a cash buyer.  It is a lot cheaper and easier when paying by cash. 

See YOU at the Auction!


Certainty of Real Estate 

Auctions have a sense of uncertainty.  Everyone wants to know, “What will the property bring?”  They already have a good idea of what they would pay for it; even I have an idea, but no one person knows for sure.  When you list a home you think that it is a certainty that it will bring around a specific price.  That specific price could happen tomorrow, the next day, the next week, the next month, the next year, or I just saw one that sold 578 days after it was listed.  Absolute auctions are a certainty your home will sell on a specific date.  The buyers should be prequalified and closing takes place up to 45 days after the auction. 


I had a real estate broker tell me, “I love it when you auction land, because you raise the value of it.” 


See YOU at the Auction!


Why Have an Auction?


An estate auction is held when the family wants to have closure and move on with their lives.  I have had a few people say this is sad, I used to believe this also.  Now I disagree.  Is it sad that someone died?  Yes, it is.  I certainly could not take everything my father had, when he passed away.  I kept the items that I wanted and we auctioned the rest.  Now I do not have to worry that it is rotting in the garage or pay for rental on a storage shed.  This is the stuff that I did not want, and I am happy that someone else is enjoying it. 


When a person moves they have an auction for different reasons.  The people are downsizing.  The person is moving to a new area and wants to start over.   It could also be it was their second home and they no longer have time for it.   


We have had an auction for a construction company, because their surplus was taking up too much space.  At another auction we had, it was more cost effective to sell the items in the warehouse than to move everything. 


Auctions are unique like people, just like the reason to have an auction.


Oh I like to be asked, “Why are they having an auction.”  It opens up a conversation. 


See YOU at the auction!


Understanding an Auction Chant

 I have been told by some they do not go to auctions, because they do not know what is being said.  Some auctioneers are easier to understand than others.  My advice is to listen to the numbers.  In most auction chants there are two numbers, what the auctioneer has and what they are asking for.  Of course what they have is the lower number and what they are asking for is the higher number.  If you do not understand the numbers ask.  The auctioneer or ringman (bid assistant) should want to help you understand.  Other words in the auction chant are called filler words.  They are exactly that, words that fill up the space between the numbers and help in the rhythm of the chant. 


The more you understand, the more you are willing to bid on the item, which is why the client hired the auctioneer.  We want you to feel comfortable with what you are doing.  Items do go quickly, so have in mind how much you want to give for the item.  This is one of the great components of an auction; you decide what you want to give for the property.  I had only been to one auction, before I started clerking for Joe and Alex and I didn’t understand what was being said.  This advice was given to me by Joe and Alex.  It helped me and now I hope it helps you. 

See YOU at the Auction!