Question Closing Costs-Advice from a NYC Real Estate Lawyer

I was perusing the Sunday Times this weekeend when I came upon a great article, which I am linking here.  The just of the article is that you should always question the closing costs when purchasing Real Estate in New York.  Further, it goes on to give great advice about negotiating many of these closing costs.  This is really practical and helpful advice that we use for basically every deal where we represent a purchaser.

I can tell you that many of my real estate clients are first time home/apt/condo buyers.  They have tons of questions, and thats normal.  I can also tell you that many of these clients are not aware of just how much closing costs can run on an average purchase.  Say, for example, you, like tons of of people out there, have just had an offer accepted on a new construction condominium in Greenpoint, Brooklyn.  You’re purchasing for $500,000.  The closing costs can literally add anywhere from 3-6% on top of that price.  But heres the thing.  MANY of these costs are completely negotiable.  In a new construction, typically the developer will try and make you, the purchaser, pay the New York City and New York State transfer taxes, which could be thousands of dollars.  You can negotiate that.  The Seller can have you try and pay THEIR own attorneys fees.  You can negotiate that out.  The Seller can try and have you pay for a re-imbursement fee for filing the Offering Plan (a document thats required to be filed with the New York State Attorney General when building new construction).  You can negotiate that out.  You can literally cut your closing costs by 50% if we just take charge and attempt to get many of these fees reduced.

Furthermore your lender charges all types of fees (many of which seem to be redundant, and many of which they cant even explain).  Some of my best clients have been able to call their lenders and negotiate these fees down, or even eliminate them altogether.

Sometimes, attorneys will say that they like clients who just “sign” and purchase, without the hassles of discussing every single fee.  I completely disagree.  I love clients who want every fee explained.  That sounds somewhat crazy, but it means the client is an informed consumer.  That actually makes it easier for us, because we know that were on the same page.  Our whole mantra is “No Surprises”.  The last thing we ever want is to come to the closing table and have our clients say “What in the world is this fee???”  With some negotiating skills and tactics, you can make sure that doesnt happen.

Any questions, as always, feel free to call.