Florida Closing Costs: Who Pays What, Buyer or Seller

Closing costs in Florida feel like a pile of unrelated fees until you see who the standard contract assigns them to. Most of the answer is written in a single paragraph of the Florida Realtors/Florida Bar residential contract (Paragraph 9, “Closing Costs; Title Insurance; Survey; Home Warranty; Special Assessments”). This guide walks through that paragraph line by line, shows the math on the two Florida taxes people ask about most, and explains where the contract leaves room to negotiate.

Quick answer: on the standard Florida contract, the seller pays the documentary stamp tax on the deed, the HOA estoppel fees, the seller’s own attorney and closing-service fees, and any recording fees needed to cure title. The buyer pays loan costs, the taxes and recording fees on the mortgage and note, the appraisal, inspections, the survey, the lender’s title policy and property insurance. The owner’s title policy is the one big item that moves depending on which box is checked.

Where the “who pays what” rule comes from

There is no Florida law that says a seller always pays X and a buyer always pays Y. Most Central Florida sales use the Florida Realtors/Florida Bar contract (or its “AS IS” version), and the contract itself lists the costs for each side in Paragraphs 9(a) and 9(b). Anything you want to shift, you negotiate in writing. Because forms are revised periodically, always read the version you are actually signing, and ask your closing agent or attorney if a line is unclear.

Costs the seller pays on the standard contract

Paragraph 9(a) lists these seller costs:

Documentary stamp tax (and any surtax) on the deed. More on the math below.
The owner’s title policy and related charges, if box (i) is checked in Paragraph 9(c). See the next section.
HOA or condominium association estoppel fees. The association charges for the letter that confirms what you owe and whether there are pending assessments.
Recording and other fees needed to cure title, such as recording a satisfaction of an old mortgage that was never released.
The seller’s attorney fees and the seller’s closing services.
FIRPTA withholding and reporting charges, when the seller is a “foreign person” under federal law and withholding applies.
Repair obligations up to the limits in the contract. Unless changed, the form’s default limit is 1.5% of the purchase price each for general repair items, wood destroying organism (WDO) treatment and repairs, and costs of closing out open or unpermitted work. If you are selling, read our guide to the “As Is” contract inspection period so these limits do not surprise you.

Also at closing, the seller pays off any existing mortgage and liens, and the seller covers special assessments imposed by a public body that are certified, confirmed and ratified before closing (Paragraph 9(f)). Installments and prorated items depend on the box checked and the contract’s standards.

Costs the buyer pays on the standard contract

Paragraph 9(b) assigns these to the buyer:

Taxes and recording fees on the note and mortgage (the Florida documentary stamp tax on the note and the intangible tax on the mortgage).
Loan expenses: origination or lender fees, credit report, and discount points if you buy them. To understand points, see discount points versus lender credits.
Appraisal fee.
Buyer’s inspections. The contract expects the buyer to pay for the home inspection, WDO inspection and permit inspection. Know what that report does and does not cover: see what a Florida home inspection leaves out.
Survey (and an elevation certificate, if required).
Recording fees for the deed and financing statements.
The lender’s title policy and endorsements.
HOA or condo association application and transfer fees.
All property related insurance, which in Florida often needs to be lined up before closing. If the property sits in a mapped flood zone, the lender may also require flood coverage; this overview of flood insurance for Central Florida homeowners explains how that works.
The buyer’s attorney and closing services fees.

Prepaids (the first year of homeowners insurance, escrow deposits for taxes and insurance, and interest from the closing date to the end of the month) also come from the buyer’s side, but they are not fees. They are your own money going into escrow or paying for coverage in advance.

The one item that moves: the owner’s title policy

Paragraph 9(c) asks the parties to check one box:

Box (i): the seller designates the closing agent and pays for the owner’s policy and charges. The buyer pays the lender’s policy and endorsements.
Box (ii): the buyer designates the closing agent and pays for the owner’s policy and charges, plus the lender’s policy and endorsements.
Box (iii): the Miami-Dade/Broward regional provision, where the buyer pays owner’s and lender’s premiums and the seller pays a capped title search or continuation, tax search and municipal lien search.

Which box is typical varies by county and by how competitive the market is. Treat local custom as a starting point for negotiation, not a rule: the box that is actually checked is what binds you. Sellers sometimes lower this cost through the re-issue credit when a prior policy exists; our post on the title insurance re-issue credit explains how.

The math on Florida’s transfer taxes

Two statutes explain most of the dollar amounts people are surprised by.

Documentary stamp tax on the deed (seller, by default)

Section 201.02, Florida Statutes, sets the tax on deeds at 70 cents per $100 of consideration. The Florida Department of Revenue states that the rate applies in every county except Miami-Dade. If the property has a mortgage on it, the mortgage balance counts as consideration.

Example: a $400,000 sale produces $400,000 ÷ $100 × $0.70 = $2,800 of deed doc stamps, which the standard contract assigns to the seller.

Documentary stamp tax on the note and intangible tax on the mortgage (buyer, by default)

Notes and mortgages are taxed at 35 cents per $100 of the amount of debt (Section 201.08, Florida Statutes). The Department of Revenue notes that the tax on a promissory note is capped at $2,450, while the tax on a recorded mortgage is not capped. Florida also charges an intangible tax of 0.002 (2 mills) on each dollar of the mortgage under Section 199.133.

Example: on a $320,000 loan, the note stamps are $320,000 ÷ $100 × $0.35 = $1,120, and the intangible tax is $320,000 × 0.002 = $640. A cash purchase owes neither. For the lender’s view of these charges, see Florida mortgage closing costs: doc stamps, intangible tax and fees.

These are statutory taxes, so they are not an area where a lender or agent can “shop for a better price.” What you can negotiate is who pays.

Items that are negotiable

Seller credits toward the buyer’s closing costs. A seller can agree to credit part of the buyer’s costs. Lenders cap what a seller may contribute depending on the loan type and down payment, so confirm the limit with the buyer’s loan officer before writing the number into the offer.
Home warranty. Paragraph 9(e) has a box for buyer, seller or N/A, with a dollar cap.
Repair limits. The 1.5% defaults can be raised or lowered.
Who designates the closing agent. This follows the title policy box.

A quick worked checklist

If you are selling

Ask the title company for a payoff letter and estimate doc stamps on your expected sale price.
Request your HOA or condo estoppel early; it can take days.
Review the disclosure obligations in Florida seller disclosure: what sellers must tell buyers.
Budget for repair negotiations up to the contract limits.

If you are buying

Get a Loan Estimate and compare it to the Closing Disclosure when it arrives.
Budget separately for the deposit, inspections, appraisal, survey and insurance. The deposit is credited at closing; see earnest money in Florida for how it is held.
Plan for the full first-year picture, not just closing day: the real first-year cost of owning a home in Central Florida.

Frequently asked questions

Who pays closing costs in Florida, the buyer or the seller?

Both. On the standard Florida Realtors/Florida Bar contract, each side has a list of costs in Paragraph 9. The seller typically pays deed doc stamps, estoppel fees and its own attorney and closing fees; the buyer pays loan costs, mortgage taxes, inspections, survey, appraisal and insurance. The owner’s title policy depends on the box checked.

Who pays the documentary stamp tax on a deed in Florida?

The standard contract assigns it to the seller. By law, however, all parties to a taxable document are liable for the tax regardless of who agrees to pay it, so it must be paid at closing.

Can a Florida seller pay the buyer’s closing costs?

Yes, if the contract says so, within the limits set by the buyer’s lender and loan program. Ask the loan officer for the maximum before negotiating.

Do cash buyers in Florida avoid mortgage taxes?

Yes. The documentary stamp tax on the note and the intangible tax apply to financing, so a cash purchase does not owe them. The deed doc stamps still apply.

Is the owner’s title policy required?

The standard contract requires a title commitment and an owner’s policy to be issued to the buyer after closing. A lender requires its own lender’s policy when there is a loan.

Sources

Florida Realtors/Florida Bar Residential Contract for Sale and Purchase, Paragraph 9; Florida Statutes sections 201.02, 201.08 and 199.133; Florida Department of Revenue, Documentary Stamp Tax. This article is general education, not legal or tax advice; ask a Florida real estate attorney or your title company about your transaction.

About the author: Tariq AbouAdma, Real Estate Broker BK3375638, Quality Real Estate Services LLC, 336 Wilshire Blvd, Suite 274-229, Casselberry, FL 32707. Questions about buying or selling in Orange, Osceola or Seminole County? Call 407-476-6667.