How much is approximately would be closing costs on a cash deal

[Mary Jay]

Lets say someone buys an apartment complex for 6 ml for cash.

How much should they add for the closing costs if no loan needed?

Thank you

[Greg Scott]

Here is some ballpark costs from a recent closing, ignoring costs directly associated with financing.  I'm assuming you would get all the same documents required by a lender.  For example, it would be foolish to buy any commercial property without having a Phase 1 Environmental completed.  A lender would require you to have this done, but if you are paying cash, nobody will force you to protect yourself.

Third Party Reports: $17K

Survey $2K

Title Recording and Search $5K

Attorney Fees ?  (You'd want an attorney to look the docs over but you wouldn't spend as much as we did as most of the attorney work was loan-related.)

Of course you will also want to have insurance in place and that is often paid as a closing cost.

Somewhat of a wild card are prorations. Typically what is known is done at closing but trued-up later.

If your PSA specifies any credits for non-ready units, that will offset the other costs.

[Mary Jay]

Quote from @Greg Scott:

Here is some ballpark costs from a recent closing, ignoring costs directly associated with financing.  I'm assuming you would get all the same documents required by a lender.  For example, it would be foolish to buy any commercial property without having a Phase 1 Environmental completed.  A lender would require you to have this done, but if you are paying cash, nobody will force you to protect yourself.

Third Party Reports: $17K

Survey $2K

Title Recording and Search $5K

Attorney Fees ?  (You'd want an attorney to look the docs over but you wouldn't spend as much as we did as most of the attorney work was loan-related.)

Of course you will also want to have insurance in place and that is often paid as a closing cost.

Somewhat of a wild card are prorations. Typically what is known is done at closing but trued-up later.

If your PSA specifies any credits for non-ready units, that will offset the other costs.

Thank you so much! Great info!
Do you know how much would you say are attorneys cost for 5-6 mln deals?
and the insurance also?

[Jay Hinrichs]

Quote from @Mary Jay:

Quote from @Greg Scott:

Here is some ballpark costs from a recent closing, ignoring costs directly associated with financing.  I'm assuming you would get all the same documents required by a lender.  For example, it would be foolish to buy any commercial property without having a Phase 1 Environmental completed.  A lender would require you to have this done, but if you are paying cash, nobody will force you to protect yourself.

Third Party Reports: $17K

Survey $2K

Title Recording and Search $5K

Attorney Fees ?  (You'd want an attorney to look the docs over but you wouldn't spend as much as we did as most of the attorney work was loan-related.)

Of course you will also want to have insurance in place and that is often paid as a closing cost.

Somewhat of a wild card are prorations. Typically what is known is done at closing but trued-up later.

If your PSA specifies any credits for non-ready units, that will offset the other costs.

Thank you so much! Great info!
Do you know how much would you say are attorneys cost for 5-6 mln deals?
and the insurance also?

Mary Jay  not sure why this is important these are very incidental costs given the total cost of the project ????

[Mary Jay]

Quote from @Jay Hinrichs:

Quote from @Mary Jay:

Quote from @Greg Scott:

Here is some ballpark costs from a recent closing, ignoring costs directly associated with financing.  I'm assuming you would get all the same documents required by a lender.  For example, it would be foolish to buy any commercial property without having a Phase 1 Environmental completed.  A lender would require you to have this done, but if you are paying cash, nobody will force you to protect yourself.

Third Party Reports: $17K

Survey $2K

Title Recording and Search $5K

Attorney Fees ?  (You'd want an attorney to look the docs over but you wouldn't spend as much as we did as most of the attorney work was loan-related.)

Of course you will also want to have insurance in place and that is often paid as a closing cost.

Somewhat of a wild card are prorations. Typically what is known is done at closing but trued-up later.

If your PSA specifies any credits for non-ready units, that will offset the other costs.

Thank you so much! Great info!
Do you know how much would you say are attorneys cost for 5-6 mln deals?
and the insurance also?

Mary Jay  not sure why this is important these are very incidental costs given the total cost of the project ????

 Because I've never bought a commercial real estate before so I was just trying to learn. Dont want to end up in a situation where we have 6 mln and cant close the deal because we forgot to account for a one more million for  closing costs... 

But it sounds like the amount of money that is needed for closing is not that much...

[Jay Hinrichs]

Quote from @Mary Jay:

Quote from @Jay Hinrichs:

Quote from @Mary Jay:

Quote from @Greg Scott:

Here is some ballpark costs from a recent closing, ignoring costs directly associated with financing.  I'm assuming you would get all the same documents required by a lender.  For example, it would be foolish to buy any commercial property without having a Phase 1 Environmental completed.  A lender would require you to have this done, but if you are paying cash, nobody will force you to protect yourself.

Third Party Reports: $17K

Survey $2K

Title Recording and Search $5K

Attorney Fees ?  (You'd want an attorney to look the docs over but you wouldn't spend as much as we did as most of the attorney work was loan-related.)

Of course you will also want to have insurance in place and that is often paid as a closing cost.

Somewhat of a wild card are prorations. Typically what is known is done at closing but trued-up later.

If your PSA specifies any credits for non-ready units, that will offset the other costs.

Thank you so much! Great info!
Do you know how much would you say are attorneys cost for 5-6 mln deals?
and the insurance also?

Mary Jay  not sure why this is important these are very incidental costs given the total cost of the project ????

 Because I've never bought a commercial real estate before so I was just trying to learn. Dont want to end up in a situation where we have 6 mln and cant close the deal because we forgot to account for a one more million for  closing costs... 

But it sounds like the amount of money that is needed for closing is not that much...

OK  if your getting a big loan then you could have 1% to 2% closing costs  but not 1 million.

[Mary Jay]

Quote from @Jay Hinrichs:

Quote from @Mary Jay:

Quote from @Jay Hinrichs:

Quote from @Mary Jay:

Quote from @Greg Scott:

Here is some ballpark costs from a recent closing, ignoring costs directly associated with financing.  I'm assuming you would get all the same documents required by a lender.  For example, it would be foolish to buy any commercial property without having a Phase 1 Environmental completed.  A lender would require you to have this done, but if you are paying cash, nobody will force you to protect yourself.

Third Party Reports: $17K

Survey $2K

Title Recording and Search $5K

Attorney Fees ?  (You'd want an attorney to look the docs over but you wouldn't spend as much as we did as most of the attorney work was loan-related.)

Of course you will also want to have insurance in place and that is often paid as a closing cost.

Somewhat of a wild card are prorations. Typically what is known is done at closing but trued-up later.

If your PSA specifies any credits for non-ready units, that will offset the other costs.

Thank you so much! Great info!
Do you know how much would you say are attorneys cost for 5-6 mln deals?
and the insurance also?

Mary Jay  not sure why this is important these are very incidental costs given the total cost of the project ????

 Because I've never bought a commercial real estate before so I was just trying to learn. Dont want to end up in a situation where we have 6 mln and cant close the deal because we forgot to account for a one more million for  closing costs... 

But it sounds like the amount of money that is needed for closing is not that much...

OK  if your getting a big loan then you could have 1% to 2% closing costs  but not 1 million.

 Thank you sir! I appreciate you all helping me!