Closing costs are a major factor when considering a home purchase in Miami or South Florida. In fact, a recent BankRate.com study showed that Miami has the fourth highest closing costs of any real estate market in the country, averaging $3,683 in 2008.
Miami Closing Costs
What closing costs can you expect to pay when purchasing a home in Miami? Let’s take a look at each of the components:
- Documentary Stamps (Doc Stamps) on the Deed: Despite their innocent sounding name, doc stamps are one of the most expensive closing costs you’ll encounter. They are assessed at the time of recording your transfer of deed and are $0.60 per $100 of the home price. Note that this rate is for Miami-Dade county only. All other Florida counties charge a rate of $0.70 per $100.
- Documentary Stamps (Doc Stamps) on the Mortgage: You’ll also need to pay doc stamps to record the mortgage on your home. Mortgage doc stamps run $0.35 per $100 of the amount of money borrowed.
- Intangible Tax on the Mortgage: Your county will also assess you a $0.20 per $100 intangible tax on the amount borrowed through your mortgage
- Recording Fees: The county assessor will charge you for each page of documents you record as part of your home purchase at the rate of $10 for the first page and $8.50 for each additional page. Expect to file between 10-15 pages as part of a home purchase.
- Title Insurance: Title insurance protects you against errors in the title process that may jeopardize your ownership rights in the future. Title insurance in Florida functions on a tiered rate structure based upon the purchase price of your home. Rates are assessed per $1,000 of your home’s value according to the following schedule:
- First $100,000: $5.57 per $1,000
- $100,000-$1,000,000: $5.00 per $1,000
- $1-5 Million: $2.50 per $1,000
- $5-$10 Million: $2.25 per $1,000
- Over $10 Million: $2.00 per $1,000
All other closing costs (such as service fees, inspection fees, and administrative fees) are discretionary and may be negotiated with your lender.
Let’s assume you’re purchasing a $200,000 home in Miami-Dade County with a $180,000 mortgage. Your total closing costs would be $3,504, with the following components:
- Deed Doc Stamps: $1,200
- Mortgage Doc Stamps: $700
- Mortgage Intangible Tax: $400
- Recording Fees (for 15 pages): $129
- Title Insurance: $1,075
Those are the basic components of Miami closing costs. You also may be interested in reading Miami Mortgages and Mortgage Brokers
for more information on financing a home purchase in South Florida.