Closing costs on purchase of land?? (sale, real estate, insurance)

[pgdc]

Hi everyone,

I currently live in Maine and am considering purchasing a piece of land to build a home on a couple of years down the road. My purchase of the land would be a cash deal-no financing.

Question is: what are any closing costs (or any other costs that I can count on) associated with buying this land? I would be buying through the listing agent (not my own agent). Should I get my own atty on this first? Any other advice?

Thanks in advance to all!

[island mermaid]

There are a couple very professional highly regarded licensed realtors that will be happy to answer your questions. They just aren't up yet!

[Northern Maine Land Man]

I beg your pardon. I was up before the sun as usual.

When a property goes under contract it's time to choose an attorney or title company. Shop around. Prices vary. Here is a current one.

Closing fee $325
Title examination $225
Title insurance $100
Registry of Deed $ 16
Town tax $ 50

Total $716

In addition you pay a real estate transfer tax to the state. It is $2.20 per thousand so if your land was $30,000 that would be $66.

[pgdc]

Originally Posted by Northern Maine Land Man

I beg your pardon. I was up before the sun as usual.

When a property goes under contract it's time to choose an attorney or title company. Shop around. Prices vary. Here is a current one.

Closing fee $325
Title examination $225
Title insurance $100
Registry of Deed $ 16
Town tax $ 50

Total $716

In addition you pay a real estate transfer tax to the state. It is $2.20 per thousand so if your land was $30,000 that would be $66.

Thanks for the speedy reply!

I will do that. Are these fees (other than the transfer tax) dependent on price, say a percentage? The sale price of the land would be $225k.

Thanks again!

[JC3]

I bought land in 2001 and here is a list of exactly what I had to pay over the selling price, am taking it right off my closing statement. I didn't finance either...paid cash. I didn't get a lawyer, closing was done by a law firm that the seller used regularly.

Tax proration 52.38
Transfer tax 121.00
Recording fee 32.00
Title update 100.00
Title insurance 165.00

Total= 470.38

Just a suggestion, makes sure the property is marked out clearly. Have the seller show you any surveyor stakes/markers....usually disputes come later AFTER you bought and another property owner wants to do something and says you are on his/her land.

[WhoFanMe]

Welcome to the forum pgdc. I'm concerned that you don't have representation in this deal, did the listing broker provide you with market analysis on the land you are purchasing so that you know you're not paying too much?

[Northern Maine Land Man]

I took it to mean the purchase is from a neighbor.

Title insurance usually varies with the price of the land because the insurance company stands to lose more if there is a title problem when it's an expensive property. Figure $2 to $3 a thousand so a $225K property would be $450 or more for title insurance.

The description of the property should be done by a licensed surveyor and this is customarily paid for by the seller. You will get a copy.

[WhoFanMe]

In addition to survey, what about the soils test, septic design, permits, utilities, zoning, etc.?

[Northern Maine Land Man]

Yes, and site prep, driveway entrance permit, clearing, etc. They just asked about closing costs. If the property is on a state road you need to get a state driveway entrance permit. These are not automatic. You need a certain sight distance in each direction which varies by speed limit on the road. Sight distance depends on hills and curves in the road along with vegetation. Lots to watch out for. If you choose a realtor to represent you, get somebody who knows about these things. All brokers and agents in Maine are licensed to sell anything. I would not presume to represent somebody in the purchase of a condominium.

[JC3]

Originally Posted by WhoFanMe

In addition to survey, what about the soils test, septic design, permits, utilities, zoning, etc.?

When I bought mine..I got the surveyor license number right off the rebar pins and checked myself on the survey. Septic design is the buyer's headache..permits..utilities..zoning etc. The person is just buying the land, what they choose to do with it is up to them and depending on what that is, they are the ones who should check on the zoning issues. Then they are the one responsible for all the other stuff and making sure they adhere to codes.

If one is going to build, they may want to be sure the amount of land they purchase meets the town standards for size. There may be minimum requirements such as 1A..2A..etc.

As for soil tests, I would have to back through the paperwork to see if I got one.