Who Pays Closing Costs in a Cash Sale in Pennsylvania?

Closing costs in a Pennsylvania cash sale are often misunderstood. Sellers sometimes expect a cash buyer to cover everything, and sometimes expect to pay nothing. The reality is specific, predictable, and actually one of the advantages of selling for cash in Pennsylvania. Here’s the complete breakdown.

The Short Answer

In a Pennsylvania cash home sale, sellers typically pay their prorated share of property taxes, their portion of transfer tax, and any outstanding liens (mortgage payoff, tax liens, judgment liens). There is no real estate commission in a direct cash sale — which is the primary cost savings versus a traditional listing. Total seller closing costs in a standard cash transaction in Allegheny County typically run 1-3% of the sale price.

Pennsylvania Transfer Tax: Who Pays

Pennsylvania imposes a real estate transfer tax consisting of two parts:

• State transfer tax: 1% of the sale price, payable to the Commonwealth of Pennsylvania
• Local transfer tax: Set by the municipality/school district, typically 1% for most Allegheny County municipalities (Pittsburgh charges 1%; many boroughs and townships charge 1%)

Total typical transfer tax in Allegheny County: 2% of sale price

By longstanding custom in Western Pennsylvania, transfer tax is split equally between buyer and seller — each pays 1% of the purchase price. This is a custom, not a legal requirement — it can be negotiated differently in the purchase agreement. In some investor transactions, buyers may request that sellers pay the full 2%; sellers can push back or factor this into their net proceeds calculation.

At We Buy Property, our standard contracts split transfer tax 50/50 per local custom unless otherwise negotiated.

Property Tax Proration

Pennsylvania property taxes are paid in arrears — meaning you pay for the previous period, not in advance. When you sell, property taxes that have accrued from the beginning of the current tax period through the closing date are your responsibility as seller.

The title company calculates this proration on the settlement statement. If you’ve already paid some taxes for the period, you may receive a credit; if taxes are due but unpaid, a debit is taken from your proceeds. This is a routine calculation, not a surprise cost.

Example: If Allegheny County taxes are $2,800/year and you close June 1 (day 152 of 365), your prorated tax responsibility is approximately $1,168 (152/365 × $2,800).

Title Insurance and Settlement Fees

In Pennsylvania, title insurance and settlement fees are typically split between buyer and seller, though the specific allocation varies by transaction and negotiation. In many cash buyer transactions:

• Owner’s title insurance policy: Buyer’s expense (protects buyer’s ownership interest)
• Settlement/closing fee: Sometimes split, sometimes buyer’s responsibility — varies by title company and negotiation
• Deed preparation: Often buyer’s expense
• Recording fees: Typically buyer’s expense for recording the new deed

In a standard We Buy Property transaction, we typically cover most buyer-side closing costs (title insurance, closing fee, deed prep), significantly reducing what comes out of your proceeds. We’ll detail exactly what you’re responsible for in the settlement statement before you sign anything.

What’s NOT a Closing Cost in a Cash Sale

The biggest advantage versus a traditional listing:

No listing agent commission: Traditional listings typically cost the seller 2.5-3% for the listing agent. Zero in a direct cash sale.

No buyer’s agent commission: In a direct buyer transaction, no buyer’s agent is involved. Zero in a cash sale (versus 2.5-3% in a traditional sale).

No repair costs: Cash buyers purchase as-is. Traditional sales often involve $3,000-$15,000+ in repair concessions after inspection.

No staging or photography: Zero in a cash sale; typically $1,000-$3,000 in a market listing.

Combined, these eliminated costs often bring the net from a cash sale closer to the net from a higher-priced MLS listing than the gross price difference would suggest.

Sample Settlement Statement: Cash Sale in Allegheny County

For a $120,000 cash sale of a property with a $75,000 mortgage payoff in Allegheny County:

Contrast this with a traditional MLS sale at $140,000 (20% higher gross):

The gap between $42,600 (cash) and $47,800 (MLS) is $5,200 — not $20,000. For many sellers, this narrower gap doesn’t justify 3+ months of effort and uncertainty.

Frequently Asked Questions: Closing Costs

Can closing costs be negotiated in a cash sale?

Yes. Everything in a real estate transaction is negotiable. Transfer tax split, who pays the settlement fee, whether the seller pays any of the buyer’s title costs — these can all be addressed in the purchase agreement. Read our offer carefully and ask questions about any line item you don’t understand.

Are there any hidden fees I should watch for with cash buyers?

With reputable cash buyers, no. With less reputable buyers, watch for: fees added at closing that weren’t in the original offer, last-minute price reductions based on “newly discovered” issues, or assignment fees (if the buyer is wholesaling your contract). Ask upfront: “Is this offer the price you’ll pay at closing, or is it subject to change?” With We Buy Property, our offer is our price — we don’t renegotiate at closing.

Ready to see exactly what your net proceeds would be in a cash sale? Contact We Buy Property LLC for a no-obligation offer with a clear settlement breakdown. 73+ Google Reviews. (412) 424-6412.