Probably the best way of looking at your Closing Costs for a Sale of a Cooperative Unit is that they will be divided into four (4) different categories. The four (4) primary categories are:
Brokerage Commissions may vary depending on the particular geographical region that you are located in and the particular market condition that you are in. For instance, if you are in what is commonly known as a “Seller’s Market Place,” the Brokerage Commission may be a bit less, depending upon the aggressiveness of various Brokers. As a general rule, a Brokerage Commission is 6% of the Purchase Price. When getting ready to sell a property you should count on the Brokerage Commission being 6% of the Purchase Price. From experience, Brokers that are very well versed in the particular area of selling Cooperatives (especially those that are well known in the industry) generally do not budge from the 6% position of their entitlement to a Brokerage Commission.
Most people agree that having a Broker involved with the particular transaction is a very positive maneuver. The Broker may assist in negotiating prices and maximizing the potential that a Seller will receive. Regardless, there are many Sellers that proceed with what is commonly known as an “SBO” and/or a “FSBO” transaction, which is “For Sale By Owner.” This is dealt with in another section of our website entitled “FSBO.” It speaks for itself that as a true “For Sale By Owner Transaction,” you do not generally pay a Brokerage Commission, however this is not always the case.
There are many instances in which although you are selling and announcing that the transaction is “For Sale By Owner,” it may be that the Purchaser that actually visits the Unit is accompanied by a Broker. In such situations the Broker is entitled to a Brokerage Commission. Sometimes there may be negotiations with that particular Broker so the 6% commission is not 6% but rather a lower commission structure. However, under all circumstances, it is imperative to have your Brokerage Commission Agreement in writing. One should never be in a situation where the Brokerage Commission is a debatable proposition. As such, under all circumstances, there must and should be written Brokerage Agreement.
As can be seen, Closing Costs are unique and need to be carefully analyzed. Only through the assistance and expertise of Kishner Miller Himes may one fully understand the ramifications and obtain a true total of Closing Costs.