Considering selling your Illinois home for sale by owner (FSBO) to avoid agent commissions? Great idea – you can expect to save about 5%–6% on listing agent commissions! But don’t forget: closing costs still come out of pocket. Illinois sellers usually pay a few important fees at closing, so it’s wise to know what to anticipate.
Typically, FSBO closing fees in Illinois are around 2%–5% of the sale price, or approximately $6,000–$15,000 on a $300,000 house. Here’s a breakdown of how much to close an FSBO transaction in Illinois, so that you will know how much to budget and not be surprised.
Selling by owner allows you more control – but more work. In addition to conducting showings and negotiating, you’ll have to deal with legal forms, title problems, and closing fees charged by lenders and governments. Although you bypass the listing broker’s fee, FSBO sellers usually continue to pay for attorney fees, title insurance, transfer taxes, and prorated taxes.
Let’s go through these expenses one by one, along with some additional services that may make your FSBO sale a breeze. And don’t forget: you don’t have to navigate this alone. A seasoned real estate lawyer (such as Ben Weaver at 23 Legal) can help you understand Illinois regulations and avoid headaches and often financial setbacks in the long term.
What Is FSBO (For Sale By Owner)?
For Sale By Owner (FSBO) is selling your house without having a listing agent. The great advantage is self-evident: you get to keep the 5%–6% listing agent commission you would otherwise give to an agent. It sounds tremendous – more money in your pocket, right? But there’s a snag.
Without an agent, you do all the work, such as pricing, advertising, negotiating the price, and executing legal documents yourself. You’ll even have to pay the buyer’s agent commission (typically 2%–3% of the selling price) if the buyer is represented by an agent.
Conversely, going FSBO can save you thousands. For instance, on a $300,000 sale, avoiding a 6% listing fee saves you $18,000. Even if you pay a 3% buyer’s agent fee ($9,000), you may still be $9,000 or more better off. It’s a matter of being prepared for all the components of the process and knowing those FSBO closing costs. In Illinois, typical FSBO closing costs are attorney fees, title insurance, taxes, and some miscellaneous line items. Let’s get into each one so you have an idea of what to plan for.
Common FSBO Closing Costs in Illinois
In Illinois, even FSBO sellers typically pay several standard closing costs. Here are the major ones and what you can expect to pay:
- Attorney Fees ($500–$1,500): Illinois is one of the only states where hiring a real estate attorney is the norm (and sometimes mandatory) in transactions. An attorney will prepare and review your sale contract, conduct the closing documents, and ensure everything meets state law. Figure on paying about $500 to $1,500 for a simple sale, depending on the level of property complexity. (Having the same attorney – such as Ben Weaver at 23 Legal – throughout the process can save time and confusion.)
- Title Insurance ($1,000–$2,000): As the seller, you normally pay for the owner’s title insurance policy to protect the buyer from any title problems that may come up (such as liens or boundary disputes). In Illinois, a typical owner’s policy costs between $1,000 and $2,000, depending on how much you sell your home for. This price may seem high, but it’s one of the most significant ones because it makes sure that your buyer and title firm trust that the deed will go through without any problems.
- Survey Fee ($350–$650): A property survey (a plat of survey) for a single-family home will be required by most lenders. If your current survey is old or is missing, the lender for the buyer will usually demand a new one. Sellers usually place the order and pay for it. It typically runs around $350 to $650, depending on the location and size of the property.
- State & Local Transfer Taxes (~$0.50 per $500): A state transfer tax of $0.50 per $500 of sale price is charged by Illinois (that is, $1 per $1,000). Sellers typically pay the state portion unless you negotiate something different. On a $300,000 sale, that’s roughly $300. Local governments (such as cities and counties) may tack on additional transfer taxes. For instance, the City of Chicago charges $3.75 per $500 and a $1.50 per $500 “Transit” fee, making $5.25 per $500 sale price. The regulation of the city is to charge the buyer $3.75 and the seller $1.50 (for the Transit) – but FSBO sellers still plan for $5.25/500 as a precaution. Other Illinois counties and cities have other rates (so check in your area), but as an estimate, budget about $0.50–$1.50 per $500 to account for all taxes.
- Recording Fees ($50–$100): Once the new deed and mortgage (if any) are recorded in county records, the county recorder imposes a fee. It is typically small, say $50 to $100 in Illinois, but don’t forget it.
- Prorated Property Taxes (Varies): Property taxes in Illinois are paid in arrears (you pay next year for the prior year’s taxes). The seller has to credit the buyer at closing for the amount of the year you’ve already “used.” Let’s say your property tax is $6,000/year and you sell midyear. You’ll owe the buyer roughly half that ($3,000) as a credit. This will be a large amount based on your tax rate, so factor it into your calculations.
- HOA Fees & Resale Certificates ($100–$500, if applicable): If you have a condo or house in a homeowners association, there will likely be fees to switch ownership. Most HOAs charge about $100–$300 for a required resale certificate (which outlines the HOA’s rules, finances, etc.), plus any pro-rated dues. Be sure to double-check with your association – these documents may be required by the buyer’s lender.
- Escrow/Settlement Fees ($300–$700): If you employ a title company or settlement/escrow agent, they’ll have a fee for coordinating the closing. This tends to be divided 50/50 between seller and buyer or negotiated. A normal total fee would be $300–$700, so set aside ~$150–$350 of that (or request an estimate upfront).
- Home Inspection Repairs/Concessions (Negotiable): Technically not a “fee,” but after a buyer’s inspection, they might request that you make repairs or provide a credit. If a buyer finds something such as a leaky roof or electrical problem, you can offer to repair it or reduce, for example, $1,000–$3,000 from your price. Not necessary, but these expenses can dent your net proceeds if they arise.
Every contract is different. One seller might already have a survey and simply pay $50 to record it, while another in Chicago might add thousands of dollars in local transfer taxes. But if you plan for these fees, you won’t be surprised by how much they cost at closing. Keep in mind that the goal is to maintain your FSBO savings and not waste them on unexpected costs!
Who Pays What in an Illinois FSBO Sale
Even in an FSBO transaction, some fees get split or assigned by local custom. Here’s the usual breakdown in Illinois (though you can always negotiate differently in your contract):
- Title Insurance (Owner’s Policy): Seller pays. In Illinois, it’s standard that the seller foots the bill for the owner’s title insurance (to benefit the buyer).
- State & Local Transfer Taxes: Seller pays the state portion and any seller-share of local taxes. (For example, Chicago’s seller pays the $1.50/$500 CTA tax.)
- Attorney Fees: Each party pays their own. If you hire an attorney and the buyer hires one, you each cover your attorney’s bill. (However, some sellers agree to pay the closing attorney’s fee as a way to simplify or sweeten the deal.)
- Survey: Seller pays. If a survey is needed, sellers typically order it. However, in a few deals, the buyer might waive the survey or split it.
- Recording Fees: Buyer pays. The cost to record the new deed and mortgage is usually charged to the buyer in Illinois.
- Appraisal, Inspection: Buyer pays. The buyer pays for their loan appraisal and inspection. (Sellers do pay for any repairs they agree to.)
- HOA Documents: Seller pays. Fees for resale certificates or HOA status letters are the seller’s responsibility.
- Property Tax Proration: Seller pays (via credit). You pay off any taxes for the months you owned the home.
- Buyer’s Agent Commission: Seller pays (if applicable). You will probably pay that if the buyer employs an agent who charges 2–3%. Some FSBO sellers want a lower commission (2% instead of 3%) to save money, but keep in mind that higher commissions can bring in more buyer agents.
No statute prevents you from negotiating a different split, but this is the Illinois “starting point” understanding for FSBO. As always, fully detail who pays what in your sale agreement so there won’t be confusion during closing.
Optional (But Smart) FSBO Expenses
You’re in charge of your sale, so you can choose extra services to boost your sale price – if the budget allows. These costs aren’t “required,” but they often pay off:
- Pre-Sale Home Inspection ($300–$500): Pre-listing inspection saves you from finding out about any issues you need to address (or be aware of) after a buyer discovers them. It indicates to buyers that you’re being truthful, and allows you to deal with issues at your own pace, and perhaps sidestep larger negotiations down the line. An average inspection will cost you around $300–$500.
- Professional Photography & Staging ($100–$800): First impressions matter. Hiring a professional to get you sharp photos (and perhaps stage your house) will make your listing pop. Nice photos will get you more money because you’ll get more buyers. You should pay about $150–$300 for a good photographer, and an additional $100–$500 if you hire a stager or spend on paint/repairs to make your house look pretty as you drive up. (It’s an expense, but FSBO sellers typically break even by selling their house in less time for more money.)
- Flat-Fee MLS Listing ($100–$500): For maximum exposure, you’d like to have your house on the MLS. As an FSBO seller, you can opt for a flat-fee MLS service. These range from roughly $100 to $500, depending on the level of service. For a couple of hundred dollars, your home is listed on Realtor, Zillow, etc., just like agent-listed homes. This can provide greater exposure to more buyers (particularly those representing buyers).
- Marketing & Advertising (Free–$300): You can also spend money on a good yard sign ($20–$50), internet ads ($50+ on Facebook/Instagram), or top listings on For-Sale-By-Owner sites. Keep expenses low by handling as much work as you can yourself, but reserve some small marketing budget so your listing won’t be ignored.
- Home Warranty ($450–$600+): Providing a 1-year home warranty can make buyers feel secure regarding repairs after purchase. The standard warranty costs ~$450–$600. It is not required, but during hot markets, it will more likely make buyers feel at ease and accelerate closing.
- Professional Help (Escrow/Title Service): Employing a reputable title company or escrow agent can make closing easier. They’ll conduct all paperwork and money handling. Their charges may be a few hundred in total (shared with the buyer), but it can be well worth it for peace of mind.
These optional expenses aren’t required, but a lot of FSBO sellers report that they pay them back by making the transaction smoother and potentially obtaining a better price. The more presentable your house looks and the fewer surprises at closing, the stronger your FSBO experience will be.
Total Estimated FSBO Closing Costs
Let’s put numbers to our example. Imagine you sell a $300,000 home FSBO in Illinois. A rough cost breakdown might look like:
- Attorney Fees: ~$1,000
- Owner’s Title Insurance: ~$1,500
- Survey: ~$500
- Transfer Taxes (IL state + small county tax): ~$300-$500
- Chicago Transfer Tax (if applicable): +$900 ($300k * 1.5% = $4,500; seller portion $1,350, buyer $3,150)
- HOA/Resale Cert (if any): ~$200
- Recording Fee: ~$75
- Property Tax Proration: ~$3,000 (if annual tax is $6k, half-year credit to buyer)
- Total (not including buyer’s agent commission or major repairs): roughly $6,000–$12,000 out of pocket.
This aligns with general guidance that Illinois sellers spend around 2–5% of the sale price on closing expenses. In reality, industry calculators put Illinois closing costs at around 2.94% of the sale price on average. So on a $300,000 sale, consider around $9,000 (plus whatever you roll over in taxes and any repairs). Compared to saving ~$15,000+ on listing agent commission, it’s still a win, but you can see that closing costs aren’t chump change. They can take a few thousand away from what you thought you were saving.
By knowing these fees in advance and shopping around (such as obtaining several attorney or title bids), you get to keep more of your FSBO savings in your own pocket.
Tips to Keep FSBO Closing Costs Low
Everyone loves saving money! Here are some quick strategies FSBO sellers use to reduce expenses:
- Shop Multiple Providers: Don’t just take the first attorney or title firm you come across. Ask no fewer than three for bids on title insurance and closing charges – they may have package deals or negotiation leeway.
- Flat-Fee MLS & DIY: Utilize a flat-fee MLS service (usually under $300) for full exposure in the marketplace. Utilize low-cost or no-cost marketing (social media, yard signs, Craigslist) to keep ad costs minimal. If you’re handy with a camera, do your own listing photos using a good smartphone.
- Set a Smart Buyer Commission: If you charge a 2.5% buyer’s agent fee rather than 3%, you save a half point. Look at local listings: if the majority of FSBOs only provide 2%–2.5%, you may be able to get by with less. Just don’t go too low, or most agents will avoid showing it.
- Get Pre-Inspection: Pay $300 for an up-front inspection. It could save you a $3,000 repair request down the line. Sometimes an expense now saves a lot more.
- Negotiate Settlement Fees: When you choose a title or escrow firm, request a “no markup” agreement or determine if you can skip any discretionary services. Sometimes businesses provide closing “bundles” for a lower total.
- Review Documents: Careful paperwork can prevent rework charges. Ensure your disclosures are thorough and accurate (including lead paint if necessary) so the buyer will not request redoing documents.
- Understand Tax Prorations: If you can, close early in the year so your tax credit to the buyer (for taxes paid this year) is less. Selling in early January amounts to paying only one month’s tax credit, not six.
By organizing (and perhaps with the assistance of an individual such as a real estate attorney or seasoned closing coordinator), most FSBO sellers reduce their out-of-pocket expenses from ~8-10% of the price to 4-6%. Saving each percentage point is additional profit for you!
Partnering with an FSBO Attorney in Illinois
A trained lawyer (such as Ben Weaver of 23 Legal) will walk you through contracts, disclosures, and closing documents so you don’t overlook something crucial. It’s like insurance: for ~$500–$1,000, you save yourself from possible errors that cost much more.
At 23 Legal, Ben’s philosophy is approachable and practical – no stodgy offices or jaw-dropping fees. As he puts it, “Dealing with legal issues can be confusing. We make it easy!” When you hire Ben, you receive one-to-one service from beginning to end. You won’t get “passed off” to a junior lawyer or billing shock. Rather, you receive transparent, flat-fee, or hourly fees up front.
For instance, Ben can review or draw up your FSBO buy agreement to ensure it’s ironclad in Illinois law. He’ll draw up the deed, address title matters, and even negotiate with the buyer’s agent if necessary. Having Ben on your side ensures you won’t miss required disclosures (such as the Illinois Real Estate Transfer Tax Disclosure or lead paint forms). Bottom line, the aim is to save you money and headaches. After all, the typical FSBO seller saves serious cash only if the sale goes through smoothly without legal complications.
If you need clarification on any of these fees or want to double-check your documents, don’t be shy to seek professional assistance.
Frequently Asked Questions
It’s not necessarily required by law in all situations, but it’s strongly advised. Illinois closings include a multitude of legal and procedural considerations – contracts, disclosures, title matters – and an attorney ensures nothing is omitted. Furthermore, numerous title companies won’t finalize a sale without one. Plan on paying around $500–$1,500 for attorney fees.
On average, count on about 3% of the sale price. On a $400,000 home, that’s roughly $12,000. Of course, it varies depending on where you live and what’s happening. You could pay just $6,000 on a $200k sale, or $15,000+ on a $500k sale. Budget for attorney fees, title insurance, taxes, etc., as we discussed above.
The seller usually pays the state transfer tax (which is $0.50 for every $500 of sales price) and any local taxes that the seller owes. In Chicago, for example, the seller pays the $1.50 CTA tax for every $500, and the buyer pays the city’s $3.75 for every $500. Always double-check the rates in your area (city or county taxes), but you should start by assuming you’ll pay at least the state tax.
If you have a 2–3% agent, you’ll be paying that out of the proceeds at closing. You can negotiate a lower commission (some FSBO sellers negotiate down to 2% to keep thousands), but keep in mind that agents can show preference for houses with higher commissions. It’s a compromise: saving you $ now in commission, but potentially costing you more in the long run if fewer agents bring viewers to your home.
Shop for attorneys and title companies, utilize a flat-fee MLS listing, and do your own marketing legwork. Get quotes from several title insurers, inquire if they can waive fees, and sell your home on MLS through a flat-fee provider (usually less than $300. Attempt to close on the first day of the year to limit tax credits. Lastly, negotiate costs with buyers upfront and divide them where possible (e.g., negotiate who compensates for recording fees).
Why Choose 23 Legal
23 Legal offers Real Estate and Estate Planning legal services to individuals, families, community associations and small business owners throughout Chicagoland. We know how intimidating “the law” can be. In fact, when most people think of law offices, they think of stuffy leather chairs, huge wooden desks and pompous lawyers who charge outrageous fees. That’s not us! We believe in 1-to-1; the same lawyer should work with you all the way through. Whether you have an estate planning issue, family trust concern, or you have a legal problem in regard to a new home, business, real estate or remodel, you need a lawyer who cares. That’s where Ben comes in! We are great listeners; more than that, we are lawyers who believe that our clients always come first.
