All sellers engage a local attorney to prepare closing documents including tax clearance letter, attesting a new deed to the buyer, and the closing statement with any applicable tax prorations and recording fees. Again, attorney fees range approximately from $800 to $2,000 depending on the complexity of the purchase.
As noted under Property Taxes previously, the Government of the Virgin Islands is several years behind in billing for real property taxes. The seller will pay all property taxes and sewer fees which have been billed and are due prior to closing.
Though not actually a closing expense, the seller will be debited at closing for the property taxes which have not yet been billed nor paid by the seller, and those credits will be applied to the buyer. The buyer will subsequently be responsible for the payment of those taxes when the bills become due.
Transactions in the USVI require 2% to 3.5% VI government transfer tax or stamp tax affixed on the deed. Transfer tax is typically paid by the seller, and is based on the higher of the purchase price or the assessed value of the property. The chart of fees is summarized below:
$1.00 to $350,000 2% of purchase price
$350,001 to $1,000, 000 2.5% of purchase price
$1,000,001 to $5,000,000 3% of purchase price
$5,000,001 and above 3.5% of purchase price
Real estate commissions are paid by the seller and co-broked (shared) on a standard 50%/50% basis with the buyer’s agent or seller sub-agent involved in the transaction (unless modified, at which point any changes would be disclosed).