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.