Are New Yorkers Getting Robbed at the Closing Table?

October 20th, 2007 category: Real Estate News

There was a recent publication, offered to New York Realtors, by the New York State Association of Realtors (NYSAR). There is encouragement provided via a caveat at the top, “This update on government and politics in New York State is a weekly publication from the NYSAR’S Government Affairs Department. REALTOR members and staff are urged to share this information as appropriate and reprint it in membership publications.”

GOOD. It would appear that the NYSAR is acknowledging, via this email, that closing costs for New York home buyers and sellers (at twice the national average, as I am understanding the figures below) is TOO MUCH.

THE REPORT INCLUDES THE FOLLOWING: “New Yorkers still paying highest closing costs in the nation- for the third year in a row, Bankrate.com ranked New York’s closing costs as the most expensive in the nation. On average, NewYorkers pay $3830. to close a $200,000. mortgage; more than $1,000. more than the national average of $2736. The addition of local and state real-estate-related taxes hikes the national average final closing cost in New York to $7194. New Yorkers pay nearly double the national average of $3681. and 60 percent more than the least expensive state, Indiana, where residents pay a total of $2339. for the same mortgage. New York’s origination fees, title insurance, attorney costs and of course high taxes contribute to the hefty final price tag on a home purchase in the Empire State.

What does this have to do with YOU? This acknowledgement of absurd New York closing costs comes on the heels of a Department of Justice and Federal Trade Commission questions about fair trade in the CLOSING COST VENUE. New York is only one of a very few states that requires the fee of an attorney to perform the contract and subsequent addenda review. Most states permit the practice of real estate without this cost.

Is ATTORNEY REVIEW supported by the real estate community? GRUDGINGLY, and here’s why: attorneys are simply the go-to in New York out of habit- nothing else. GET MY ATTORNEY. Guess what? It’s an incurred expense (as a built-in) that is subject to the discretion of the buyer/seller. Why are most states able to conduct a real estate transaction in the absence of the attorney contingent? Probably because…A HOUSE IS A HOUSE. Rocket science is not required.
New York is increasing the required hours for licensees. While this might not provide the comfort of an outside opinion, it is a step forward for real estate agents in New York. Bottom line: you can pick a bad lawyer, and you can pick a bad real estate agent.

The best option is to be VERY CLEAR, with your own investigation, as to the value of the home that you’d like to buy, or sell. A great real estate agent will provide reality. While a lawyer (who never sees the home) will offer annoyances (this is not legal advice) weighing out the two may be an option that you have as a buyer or seller of real estate in New York. We hope so.

Home buyers, and sellers in the North Fork of Long Island (Riverhead, Calverton, Baiting Hollow, Jamesport, Laurel, Mattituck, Cutchogue, Peconic, Southold, New York)- we’d love to help. Call or email.

This entry was posted on Saturday, October 20th, 2007 at 1:37 am and is filed under Real Estate News. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

2 Responses to “Are New Yorkers Getting Robbed at the Closing Table?”

Are New Yorkers Getting Robbed at the Closing Table? at NY Real Estate Attorney Says:
October 24th, 2007 at 10:45 am
[...] Original post by Laurie Mindnich [...]
South Charlotte Real Estate Says:
November 8th, 2007 at 10:11 pm
Laurie– yes they are getting ripped AND it takes way to much time to close there too..I am constantly surprised by how difficult attorney’s seem to make closing in New Yotk– just means they need expert agents like Options Realty! Do they make it difficult to justify their fee? We close with attorneys, their typical fee? About $450. We don’t have the transfer taxes (yet) so a 200k home will generate $3500 or so in closing costs to the buyer, about 500 above agent commission to the seller.It can be different! Thinking real estate agents like tomatoes, Terry from Charlotte,NC

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