What are real estate closing costs?

Most buyers and sellers are really unaware of what are true closing costs in real estate transactions. Although I had bought and sold several homes before practicing real estate in Spring Hill Florida, I truly did not understand the break down of these costs for both buyer and seller.

Real estate closing costs are the total of charges paid to different parties aligned with the buying and selling of real estate. For sellers, they are usually about 9.5-10% of the gross sales price of a property. Some of the closing costs encountered are: prepaid property taxes, discount points, escrow fee, documentation fee, homeowners association fees, pest/rot inspection, real estate commission and title insurance premiums.