Understanding Coral Gables and Miami-Dade Closing Costs

Most of your closing bill is set by law, not negotiation

A surprising share of a Florida closing bill is not negotiable at all; it is set by statute and by the county. Knowing what those line items are, and how Miami-Dade differs from the rest of the state, takes the mystery out of the settlement statement for a Coral Gables or greater Miami-Dade transaction.

Documentary stamp tax on the deed

When a property is sold, Florida charges a documentary stamp tax on the deed, based on the consideration (generally the sale price). On a typical sale this is customarily a seller cost, though the contract can allocate it differently. It is one of the larger transfer-related taxes in a purchase.

Documentary stamp tax on the note

If the buyer is financing, there is a separate documentary stamp tax on the promissory note (the loan itself). This is a financing cost and is customarily borne by the borrower. It applies to the note amount rather than the purchase price, so cash buyers do not see this line at all.

Intangible tax on the mortgage

Florida also imposes a one-time intangible tax on the mortgage that secures the loan. Like the note stamp tax, it is a financing charge tied to the loan amount and is customarily a borrower cost. Together, the note stamp tax and the intangible tax are the reason a financed closing has more tax lines than a cash one.

Recording fees

The county recorder charges a per-page recording fee to enter the deed, the mortgage, and any other instruments into the public records. Recording is essential (it is what makes the transfer and the lender's lien public and establishes priority), and the fees are modest relative to the taxes above.

The Miami-Dade surtax and owner's-policy nuance

Miami-Dade County has its own wrinkle. On top of the state documentary stamp tax on the deed, the county imposes an additional county surtax on the deed, but that surtax is not due on a document that transfers only a single-family residence. A single-family home sale in Miami-Dade is exempt from the county surtax. The surtax does apply to transfers of property that is not a single-family dwelling: commercial property, vacant land, and multi-family or other non-single-family residential property. The base documentary stamp tax on the deed still applies to every transfer; only the county surtax carries the single-family exemption, and the mortgage intangible tax and recording fees described above are unaffected. So the deed-related tax picture in Miami-Dade is not identical to neighboring counties, and it turns on what kind of property is changing hands. Just as important, who customarily pays for the owner's title policy is different here. In most Florida counties the seller customarily pays for the owner's title policy; in a handful of counties (including Miami-Dade) the buyer customarily pays it. Title insurance premiums themselves are promulgated (set by the state), so the premium does not change from agency to agency; only the custom about who pays does. For a fuller explanation, see Who Pays for Title Insurance in Florida.

Who customarily pays what

Pulling it together for a typical Miami-Dade financed purchase:

• Seller customarily pays the deed documentary stamp tax and, in many counties, the owner's policy; but in Miami-Dade the owner's policy custom flips to the buyer.
• Buyer/borrower customarily pays the note documentary stamp tax, the mortgage intangible tax, the lender's title policy, and recording fees on the loan documents.
• Prorations of property taxes and any association dues are split as of the closing date.

These are customs, not rules. None of them is mandated by law.

The municipal lien search

There is one more Miami-Dade closing item worth flagging. Beyond the recorded title search, a closing should include a municipal lien search of city and county records for unrecorded items: unpaid municipal amounts, code violations that were never recorded, open or expired permits, and utility balances to be settled at closing. In Miami-Dade, when the purchase contract selects the Miami-Dade County provision, the seller customarily pays for the municipal lien search (along with the tax search and the title continuation), though as always the contract controls. To understand what this search catches that the recorded public records do not, see our guide to municipal lien searches.

Why the contract controls

Every one of these allocations can be changed by agreement. The purchase contract is the document that actually decides who pays each item, and it overrides local custom whenever it addresses a cost. If you want to know exactly how the costs would fall on a specific deal, do not rely on rules of thumb; run the numbers. Our Florida title and closing-cost calculator produces an itemized estimate by county and by purchase or refinance, and you can contact Union Title Services for a binding figure and to talk through your contract terms.