Washington state Real estate law

[EmptyGarage]

Do we have anyone with expertise is real estate around Seattle?

My elderly aunt is selling her home and the real estate agent has said it would cost 45K in total fees to sell a 350K property. The house has a reverse mortgage, is the administration fee from that costs 10 of thousands? The agents fees are supposed to be 5%.

The agent told her these where new fees from some new laws...

[stomachmonkey]

Seems the answer to the question is contained in "elderly aunt".

Is this the only agent in Seattle?

This is an important financial undertaking so due diligence dictates interviewing several agents before picking one.

[porsche4life]

That seems way high! But I don't know what goes into selling something with a reverse mortgage.

So with 5% and even if they contribute 3% to buyers closing costs, you still have more than 10k un accounted for. Something smells fishy.

[bpu699]

The $45,000 probably isn't fees. That's probably what she drew down in equity in the reverse mortgage. She has to pay that off at the closing. The agent has nothing to do with that cost, it's the lender she borrowed from. Review the loan documents...

Bo

[LakeCleElum]

Just last week, I got a check from a house I sold in King County (Seattle)........Ask the agent for a breakdown of the fees. That will give your answer.

[Eric Coffey]

Originally Posted by EmptyGarage

Do we have anyone with expertise is real estate around Seattle?

My elderly aunt is selling her home and the real estate agent has said it would cost 45K in total fees to sell a 350K property. The house has a reverse mortgage, is the administration fee from that costs 10 of thousands? The agents fees are supposed to be 5%.

The agent told her these where new fees from some new laws...

There is a state/county transfer tax in WA that is typically paid by the seller there. However, for King County it is currently 1.78%. That amounts to $6,230 on a sales price of $350k. If you add that to a total commission of 5%, it equals $23,730. While there will be additional title/escrow fees associated with the sale that the seller will incur, they should be relatively minor in comparison (say an additional +/- $1,500). Assuming no seller concessions, the total seller fees (outside of loan payoff) shouldn't even come close to $45k. That is nearly double the sum of the commission and state/county transfer tax. You should have your aunt email the agent (or do so on her behalf) to see if they can provide an explanation of the additional fees, on record. As Sid mentioned, there may be something rotten in Denmark here.

Regarding the reverse mortgage: Assuming it was an FHA product, there shouldn't be any hidden fees or pre-payment penalties. Even if it wasn't an FHA loan, there should be state laws in place that prohibit such. That said, you should contact the bank to get an exact payoff amount. That will help determine her situation and is key to knowing her financial picture for the property/sale.

[Eric Coffey]

Originally Posted by bpu699

The $45,000 probably isn't fees. That's probably what she drew down in equity in the reverse mortgage. She has to pay that off at the closing. The agent has nothing to do with that cost, it's the lender she borrowed from. Review the loan documents...

Bo

Given the numbers, that would make more sense.

However, the fact that she was told it was from "some new laws" raises suspicions a bit. More info is needed, and the first order of business would be to get a pay-off figure from the bank.

[john70t]

Ask for those detailed fees in writing under an official letterhead.

The agent can say whatever he wants.
Doesn't mean it is correct.

There are federal laws against preying on the elderly.

[Neilk]

What about Title insurance? The Title Insurance fees in Texas are stupid expensive.