London Foster Realty at Dadeland
Liz Kenneally | Realtor

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Real Estate Closing Statements: Debits and Credits Explained for Miami Buyers and Sellers

In the final stages of a real estate transaction, one crucial document stands out: the real estate closing statement. This important paperwork, often called a settlement statement or HUD-1 statement in the United States, details the financial specifics between the buyer and seller. At its core, this document revolves around two essential concepts: debits and credits.

Understanding Buyer Costs in a Miami Real Estate Closing Statement

Debits represent what the buyer owes to purchase the property, beyond just the purchase price. These include various expenses needed to finalize the deal and officially transfer ownership.

See Sample of Closing Settlement Statement

Key components of debits include:

- Purchase Price: The agreed-upon price of the property.
- Loan Fees: Charges for processing the buyer's loan if financing is involved.
- Property Taxes: Taxes prorated for the portion of the year the buyer will own the property.
- Homeowner’s Insurance Premiums:  Insurance costs for the coverage period.
- Homeowners' Association (HOA) or Condo Fees: Fees for maintenance and amenities that are prorated for the portion of the year the buyer will own the property.

As the closing date approaches, additional debits may include:

- Attorney Fees: Legal fees for handling the transaction.
- Title Insurance: Fees for insuring the buyer's title to the property.
- Recording Fees: Costs for officially recording the property transfer.

These debits give a clear picture of what the buyer needs to pay to complete the purchase.

Credits: What the Seller Receives in a Miami Real Estate Closing

Credits are the amounts owed to or received by the seller. These credits help offset the seller's obligations and determine their net proceeds from the sale.

Key components of credits include:

- Purchase Price: The total price the buyer agrees to pay for the property.
- Earnest Money Deposit: A deposit made by the buyer to show their commitment.
- Prepaid Expenses: Property taxes, insurance, or homeowners' association (HOA) or condo fees the seller has already paid.

Other credits might include prorated amounts for utilities or additional homeowners' association (HOA) or condo fees, seller concessions, and any agreed-upon adjustments, ensuring a fair transaction for both parties.

Seller's Costs: Commissions to Realtors

One significant expense for sellers is the commission paid to real estate agents. This commission is typically a percentage of the sale price and is split between the seller’s agent and the buyer’s agent. The seller’s obligation to pay these commissions is detailed in the closing statement and is deducted from the sale proceeds.

Balancing Debits and Credits: Making Sure Everything Adds Up

As the closing date approaches, a careful reconciliation of debits and credits ensures a balanced financial outcome for both the buyer and seller. This balance is not by accident but the result of precise accounting. It ensures both parties are treated fairly and the transaction remains transparent.

Understanding debits and credits in a real estate closing statement is crucial for both buyers and sellers. It clarifies the financial dynamics of property transactions, providing transparency during this critical phase.

Navigating real estate transactions can be complex, but with a firm grasp of debits and credits, both buyers and sellers can approach the closing with confidence, knowing that every financial aspect is thoroughly addressed in the closing statement.

If you have any specific questions about your upcoming real estate transaction or anything particular about the Miami market that you'd like more information on, feel free to reach out.

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What my clients are saying  

Efficient, Effective, and Ethical! Working with Liz Kenneally was an absolute pleasure. Her efficient and effective approach to real estate made the entire process seamless and stress-free. From the moment we met Liz, we knew we were in good hands. She took the time to listen to our needs and preferences, ensuring that we found the perfect home in South Miami. Liz's commitment to ethical practices and transparency gave us peace of mind throughout the transaction. We highly recommend Liz to anyone looking for a trustworthy and reliable realtor in Miami.

 

~ Michael and Jennifer D.

I hired Liz Kenneally to lease out my apartment, and within just 1-2 weeks, she secured long-term tenants who have been a great to work with for the past three years. Her efficiency, professionalism, and warm demeanor made the entire process seamless. Liz understood my needs and executed flawlessly. I couldn't be happier with the outcome. I wholeheartedly recommend Liz!

 

~ Sofia I.

Finding office space for my company was made effortless thanks to Liz Kenneally's exceptional service. Referred to her by a trusted source, I quickly understood why she comes highly recommended. Liz guided us through every step with professionalism and expertise, ensuring we secured the perfect space to meet our needs. The office space exceeded my expectations, boasting a prime location, generous square footage, and excellent amenities. Liz's attention to detail facilitated a seamless transition into our new workspace. Her responsiveness and proactive communication made the leasing process a breeze. Working with Liz Kenneally was a pleasure, and I wholeheartedly recommend her to anyone in search of commercial real estate. Five stars all around!

 

~ Paul M.

Professionalism Personified! Liz Kenneally is the epitome of professionalism. Her attention to detail, proactive communication, and tireless work ethic set her apart from other realtors. Liz guided us through the process of buying our dream home in Coral Gables with ease and confidence. She was always one step ahead, anticipating our needs and addressing any issues promptly. Liz's commitment to excellence and integrity made us feel confident and reassured throughout the entire transaction. We cannot recommend Liz highly enough!

 

~ James and Amanda R.

Liz Kenneally proved to be an exceptional real estate agent. Her expertise in Dadeland area homes, our preferred locale, was truly impressive. Liz's dedication to understanding our needs, preferences, and budget constraints was evident throughout our interactions. She tirelessly worked to find us the perfect home, keeping us updated and promptly addressing all our questions. Liz made the entire process enjoyable, turning house hunting into an adventure. I enthusiastically endorse her to anyone in the market to buy or sell. Thank you, Liz, for your outstanding service!

 

~ Camila I.

5 Stars for Responsiveness, Negotiation skills, Professionalism and communication, Market expertise, Was on point at every turn, from offer to closing.

 

~ Jordi B

Liz went above and beyond to market our property effectively, attracting a flood of interested buyers. Her attention to detail and commitment to showcasing our home in the best possible light truly paid off. We couldn't believe it when offers started pouring in, and even more so when the final sale price exceeded our initial expectations! It was the highest sold price in the community! Liz was responsive, proactive, and always had our best interests at heart. Her negotiation skills were impeccable, ensuring that we got the best possible deal for our property.

 

~ Willy and Gloria P.

Liz was the listing agent for a Miami property I called on and made an appointment to see . That's how it all started.I wasn't working with any agent and I told Liz I didn't want to commit to anyone. She stated she understood, nevertheless, she was relentless in keeping in touch with me. Finally, in one of her phone calls, Liz asked me if she was working hard to get my business ? I said yes, of course. Then she stated, "Imagine, what I am capable of doing in finding and negotiating for you in a tough and competitive Miami market?". That clinched it !

 

~ Arile R.

I want to thank this wonderful Lady that stuck with me until I found just the right place. I am very satisfied and you will always have a friend here. Thank you for everything Liz, you're the best.

 

~ Manny

We trusted her strategy and ended up buying the property that we were initially turned down on. You can say Liz turned that No into a Yes for less money! She is relentless. Thank you, Liz, you are a hard worker, trustworthy, on top of your game and simply a pleasure to team up with you

 

~ Alex Y.

As a business man, one of the things that impressed me about Liz is is her negotiation skills, patience and cool under pressure. She looks for a win-win even though at times we were just being one sided. Liz reminded us it's a sellers' market with properties selling quickly at or little above asking price in the area we wanted to buy.Whatever we weren't familiar with, Liz simplified it so we felt comfortable and understood the transaction.

 

~ Vincent S.

"...One of her best qualities is her ability to stand back, listen to your needs, present you all the alternatives and let you make the original decisions. She is not assertive with her opinion but when she says you better listen because it will be in your own best interest..."

 

~ Ioannis L.

I had a great experience with Liz in the sale and purchase of my new home. She was always available to answer questions with great confidence and knowledge. I consider her a personal friend since we met, through the process of buying this home. Highly recommend her to anyone looking to sell or buy.

 

~ Maria D

Ms Liz Keneally was a angel sent. I was going through personal hardship. And having a hard time not only selling The property but with the result of impending foreclosure. Which at the time was a very difficult time in my life. And she came along. And got a contract within a week. And I have nothing but gratitude towards her and her team. That treated me and my children like family.

 

~ Xenia L.

Liz has been a wonderful real estate agent for us. She is an excellent communicator, and communicates in a very timely manner. Liz provided easy to understand comparisons when we had multiple offers for the property that we were selling. Liz makes sure that all the details are taken care of, and most importantly perseveres in resolving the many issues that arise in a real estate transaction. We have been extremely happy with the work that Liz has done for us. We would highly recommend her for anyone who is seeking to sell or buy property.

 

~ Gary N

As a first time home buyer, I was nervous and worried about being taken advantage of. Liz calmed my nerves and guided me through the process. She was easy to communicate with and took the time to educate me.There were times, we had to negotiate and Liz always made sure to keep the deal alive, while protecting my interests. I have only wonderful things to say about her and would work with her again.

 

~ Sarah S.

Liz was professional from the exploratory stages of home buying to its completion. As a first-time buyer, I was looking into foreclosures. I did not expect the unexpected to say the least. From negotiations to paperwork, I am truly grateful for Liz's knowledge and skills. She guided me through the process and stood by my side when delays arose and frustrations even larger. Her calmness and verbal prowess ultimately helped me secure my very first home! Thank you, Liz!

 

~ Hennifer M

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