When you prepare to close on a house you are buying, you should receive some credits from the person selling the house. Some credits are standard types that you can find with any home sale, while others are extra ones due to the details of the purchase agreement you make with the seller. The credits you receive reduce the amount of money you must pay for the house, and here are some of the credits you might receive when you close on a house you are buying.
Property taxes are typically payable the year after they accrue. In other words, the property taxes for the year 2017 are due in the year 2018. A seller is responsible to compensate the buyer for all the taxes that are due up until the day of closing, and this generally involves adding in last year's taxes plus the taxes from January 1 of the current year to the closing date.
When you close on a house, you become responsible for all the taxes on the house, including the taxes due from last year, and this is why you will get a credit on your closing statement from the seller. While you are responsible for paying all the taxes, the seller is still responsible for reimbursing you for all the taxes he or she accrued until the day of closing. Your settlement statement should reflect a credit for this, and you should verify the accuracy of the amount listed on the statement.
Fees the seller agreed to pay
If you and the seller agreed that the seller would pay certain fees for your closing, these will be reflected on the settlement statement as credits. An example of this would be the fee paid for a home inspection, if the seller agreed to cover this cost. Sellers might also agree to pay for other types of inspections, such as a pest inspection or roof inspection. If the seller agreed to this, make sure it is listed on the statement.
Additionally, some sellers will agree to pay a certain amount of the closing costs for the buyer. If this is the case with your deal, make sure this amount is listed in the form of a credit on the statement.
You can work out any type of deal with the seller of a house, and you should verify the accuracy of all the details listed on the settlement statement, simply to make sure they are correct. Your real estate agent can assist you with this task or any other task related to buying your next family home.