What Closing Costs Does a Seller Pay in Seattle?

What comes out of a Seattle seller’s proceeds

Two sellers on the same Queen Anne block can walk away with very different amounts because one still carries a large mortgage and the other agreed to a repair credit after the inspection. A flat percentage hides that. Knowing the lines, and where the number for each comes from, is more useful.

Where the purchase agreement assigns a cost differently, the agreement controls.

Real estate excise tax: the state’s graduated schedule and Seattle’s local share

Washington taxes the sale of real property, and the law puts that tax on the seller. After the loan payoff and any commission, it is often the largest line on the statement.

Since 2020 the state portion has been graduated. The price is divided into tiers, each taxed at its own rate, and the rates rise as the price passes each threshold. The thresholds are adjusted every four years, and a new set takes effect January 1, 2027, which is one reason figures copied from an old article go stale. On top of the state tax, cities and counties can add a local portion, and Seattle does.

The tax is reported on the real estate excise tax affidavit, which escrow prepares and you sign. The Washington Department of Revenue publishes the current schedule and a calculator on its website, and your escrow officer will run the exact figure for your price. It applies the same way to a cash sale and a financed one. Some transfers, such as certain transfers between family members or into a trust, can be exempt. If you think yours might qualify, ask a real estate attorney or the Department of Revenue before counting on it.

Title insurance and escrow: which side pays what in Washington

A typical financed sale produces two title policies. The owner’s policy protects the buyer’s ownership, and in King County the seller customarily pays for it. The lender’s policy protects the buyer’s lender, and the buyer pays for that one. A cash sale has only the owner’s policy.

Escrow is the neutral party that holds the money and documents until closing, then pays everyone and records the deed. Its fee is customarily split between buyer and seller. Expect a few small charges beside it, such as wire fees and the fee to record the release of your deed of trust.

The title company opens a report as soon as the sale is agreed, and it turns up anything that has to be cleared first: an old judgment, a contractor’s lien, a loan that was paid off years ago but never released of record. Those get resolved from your side of the ledger, and they clear much more easily with weeks to spare than in the last days of escrow.

Payoff, prorated property taxes and final utility bills

Every loan secured by the house is paid in full at closing. That includes the first mortgage, a home equity line even with a zero balance (it still has to be closed), and any reverse mortgage. Escrow orders payoff statements straight from each lender, and each figure includes interest up to the payoff date, so expect it to run a little higher than your last monthly statement.

King County bills property taxes for the calendar year and collects them in two halves, due April 30 and October 31. Depending on when you close and whether the current half is paid, you’ll either receive a credit from the buyer for taxes you prepaid or owe the buyer for days you lived there without paying yet. It appears as a proration on the settlement statement.

Utilities follow the same logic. Escrow usually requests a final water and sewer reading from Seattle Public Utilities and holds back enough to cover it. You close your own Seattle City Light account, and gas with Puget Sound Energy if the house has it. If you plan to stay after closing, the utility handoff moves to your move-out date, and rent-back after closing covers how that usually gets written.

Commissions and concessions: what is open to negotiation

Brokerage commission is negotiable. It is set in your listing agreement, and any amount you offer toward the buyer’s broker is a separate decision for your house. Since January 2024, Washington has required a buyer’s brokerage to have a written services agreement with the buyer before it can be paid, so how the buyer’s side gets paid often comes up inside the offer itself.

Concessions are the other movable line. After the buyer’s inspection, requests usually arrive as either a repair or a credit toward the buyer’s closing costs, and a credit comes straight out of your proceeds. Some findings produce larger requests than others, like a cracked side sewer or a roof near the end of its life. Finding them before you list and pricing with them in mind tends to go better than negotiating them under a deadline.

Forms escrow will ask you to sign

Beside the deed and the excise tax affidavit, escrow will hand you a few documents that have nothing to do with price. One certifies your status as a U.S. or foreign person for federal tax purposes, since a sale by a foreign seller can require federal withholding at closing. Another gathers the information escrow uses to report the sale to the IRS. If you live outside the United States, hold the house in an LLC or a trust, or are signing for an estate, tell escrow in the first week so the right paperwork is ready.

Does Washington’s capital gains tax apply to selling your home?

Washington’s state capital gains tax generally excludes sales of real estate, so selling your house usually doesn’t trigger it. The federal side is different. Federal tax law has an exclusion for gain on a primary residence, with ownership and use requirements, and gain above the exclusion can be taxable. Rentals and inherited houses have their own rules. None of that shows up on the settlement statement, which is exactly why it gets missed. Talk to a CPA before you list, especially if the house has been a rental or came to you through an estate.

Cash offer or listing: comparing what you actually keep

The excise tax and the loan payoff land about the same way on either route. What changes is everything around them. A listing usually brings the higher price, along with commission, prep costs, inspection credits and the monthly carrying costs while the house is on the market. A cash sale usually brings a lower price and fewer of those deductions. Some cash buyers also cover part or all of the closing costs as part of their offer, so read each offer’s terms line by line.

The Sell Now 206 home page sets the two routes side by side. For the exact figures on your own closing, the document to trust is your escrow officer’s estimated settlement statement.