How Much Are Closing Costs When Selling a Home in Huntington Beach?

January 9, 2025 | 714-336-0394 | Scot@CampbellRealtors.com | Broker of Record – Coldwell Banker-Campbell Realtors

Understanding Closing Costs in Huntington Beach

If you’re buying or selling a home in Huntington Beach, understanding closing costs is crucial for a smooth transaction and avoiding surprises. Here’s a breakdown of everything you need to know about closing costs in Surf City, USA.

What Are Closing Costs?

Closing costs include a variety of fees associated with finalizing a real estate transaction. They typically cover lender fees, appraisal charges, escrow & title services, county recording fees, HOA transfer fees, disclosure reports, and other expenses.

Who Pays Closing Costs in Huntington Beach?

In Huntington Beach, the allocation of closing costs is negotiable, but certain conventions often apply.

The escrow fee is split between the buyer and seller but others are traditionally paid by either the buyer or the seller.

Buyers generally cover costs tied to their mortgage, appraisal, and property inspections, while sellers typically handle real estate agent commissions, recording fees, HOA transfer fees, title insurance for the home, pest control treatment, and disclosure reports. Knowing who pays what is essential for budgeting and negotiation.

Detailed Breakdown of Closing Costs

Here is a closer look at the common closing costs you’ll encounter in a real estate transaction in Huntington Beach:

Traditional Buyer Closing Costs:

Loan Origination Fees – Loan origination fees cover the lender’s cost to process the loan. This fee is usually between 0.5% to 1% of the loan amount and is primarily a buyer’s responsibility.
Lender Title Insurance Policy – The lender Title insurance protects against potential liens & judgements filed against the buyer and warrants their identity. Buyers often pay for the lender’s policy. Depending on the loan amount, this cost can range from several hundred to over a thousand dollars.
Appraisal – Most lenders require an appraisal to confirm the home’s value. Appraisals in Huntington Beach typically cost between $700 and $1,000.
Home Inspection Fees – Buyers are responsible for inspection fees, which vary based on the type of inspection—general, pest, sewer scoping, or mold.

Property Taxes – While property taxes are not a closing cost, the seller may have already pre-paid some of the County Property Taxes and the buyer and it is customary for the buyer to reimburse the seller through escrow. The escrow officer will compute the proration.
Homeowner’s Insurance – The buyer will be required to pay for homeowner’s insurance in escrow, and the buyers costs may including private mortgage insurance (PMI) if their down payment is less than 20%.

Traditional Seller Closing Costs:

Owner’s Title Insurance Policy – The lender Title insurance protects against potential title issues. Buyers often pay for the lender’s policy, while sellers typically cover the owner’s title insurance. Depending on the home’s value, this cost can range from se
Property Taxes – While property taxes are not a closing cost, the some property taxes may have already accrued which the buyer will be required to pay once the tax bill arrives. It is customary for the seller to reimburse the buyer through escrow for the accrued property taxes. The escrow officer will compute the proration.
Real Estate Transfer Tax – California does not have a statewide real estate transfer tax, but Huntington Beach home seller pay a county recording fee known as the Documentary Transfer Tax.
Pest Control Report & Clearance – The seller should schedule a Pest Control Inspection and obtain a Structural Pest Control Report from a licensed pest control contractor. This report is part of the disclosures given to the buyer. In many, but not all instances, the buyer will request that the seller pay for the treatment of active termite and dry rot infestation.
Homeowner Association Disclosures – California statute requires the seller to pay for the HOA disclosure packet during the escrow. Included in the packet are the CC&Rs, bylaws, rules, financials, reserve study, minutes, and any other pertinent information related to the ongoing management of the development.

Commissions

Sellers: Traditionally, the seller paid all of the real estate commissions. And, the seller selected the amount of commission to be paid to the buyer’s agent. In the New Era brought on by the NAR Settlement in 2024, sellers continue to decide how much commission to pay the Seller’s Exclusive Agent.
Buyers: In the New Era the Buyer determines the amount of commission to be paid to the buyer’s agent, and then when making an offer on the home, they either request the seller pay the commission OR the buyer may elect to pay the commission to the buyer’s agent directly.

Reducing Your Closing Costs

Both buyers and sellers can take steps to minimize closing costs:

Tips for Buyers:

Shop Around for Lenders: Comparing lenders can save you money on origination and administrative fees.
Negotiate Fees: Ask lenders about potential waivers for application or processing fees.
Explore No-Closing-Cost Loans: Some lenders allow closing costs to be rolled into the mortgage. Keep in mind this can increase monthly payments.

Tips for Sellers:

Prepare the home for the market: Doing maintenance, and highly visible but inexpensive repairs and preparations will help increase price and reduce the cost of items the buyer wants repaired. Painting, cleaning, pre-packing, and fixing simple items like worn out GFI outlets, switches, light bulbs, etc. will result in a higher sale price and net proceeds.
Prioritize Repairs: Do not spend too much time or money on preparations. Focus on essential repairs and negotiate with buyers for anything beyond that.
Compare Agent Commissions: Shop around for real estate agents with competitive rates to reduce your overall costs.

Frequently Asked Questions About Homeowner Closing Costs in Huntington Beach

How can I estimate my closing costs if I am selling a Huntington Beach home?
A good rule of thumb for home sellers is to budget between 2.5% and 5% on commissions and about 0.5% (not including repairs) of the home’s purchase price for closing costs. Since, commissions are negotiable and there are instances where some buyers will not ask the seller to pay the commission it may be possible for the seller paid commission to be as low as 2.5%.

Are there any Buyer closing costs that can be waived?
Some lenders offer “no point, no fee loans”. And certain lender fees, like application or underwriting charges, may be negotiable. Buyers should always ask about potential waivers.

Resources and Tools

Closing Cost Calculator: Online tools can help you estimate your total costs based on the purchase price and loan type.
Local Real Estate Agents: Connect with agents who specialize in Huntington Beach to gain insights and navigate the process smoothly.

Conclusion

Closing costs are an inevitable part of buying or selling a home in Huntington Beach, but understanding them can help you prepare and even reduce expenses. Whether you’re buying your dream coastal home or selling a property, being proactive and informed is key to a successful transaction.

If you decide to sell your home, partnering with an experienced individual real estate agent in Huntington Beach can improve your results. A knowledgeable agent brings expertise in the local market, sharp negotiation skills, and access to a network of potential buyers. They’ll guide you through every stage, from market timing, preparing the home, determining the perfect listing price, marketing your home effectively, and managing the escrow to insure the on-time closing.

Important tip: Do not assume listing with a big “team” or “group” will result in you working with the most knowledgeable and experienced agent. While the “teams” tout their success in closing many homes and being #1 (in the state, country, or universe), the fact is they have many realtors who give “credit” to just one “team leader”. When listing your home, you may speak to that team leader initially, but your file will most likely be passed to a junior associate for the remainder of the transaction. The junior associate will have nowhere near the education, experience, and skill to be found in a top individual Realtor working in your market. A top individual agent will have assistants that help with photography, marketing, and transaction paperwork, but the important transaction tasks will be handled by the Realtor you hired!