Closing costs in Vermont

The rules

What Vermont does differently

State transfer tax

0.5% of the first $200,000 and 1.25% above $200,000 for a principal residence, plus a 0.22% Clean Water Surcharge on value above $200,000 (property transfer tax, 32 V.S.A. § 9602); non-principal residences 3.4% plus the surcharge (about 0.985% of the price at $400,000).

Who pays it

Buyer, by custom.

County and city add-ons

None; there is no municipal transfer tax. A second home or short-term rental at $400,000 pays $14,480 (3.62%) instead of $3,940.

Attorney at closing

In Vermont closings are customarily handled by an attorney rather than a title or escrow company, so budget an attorney fee.

Owner’s title policy

The buyer customarily pays for the owner’s title insurance policy in Vermont, along with the lender’s policy.

Notes

The statute puts the tax on the buyer. On a $400,000 principal residence: $1,000 + $2,500 + $440 surcharge = $3,940. The first $250,000 is exempt with a VHFA, USDA or VHCB-assisted mortgage. Attorneys customarily examine title and conduct the closing.

• legislature.vermont.gov — “0.5 percent of the first $200,000.00 in value ... and at the rate of 1.25 percent of the value ... in excess of $200,000.00”
• tax.vermont.gov — “Non-Principal Residence Tax Rate ... 3.40% (3.62% including the Clean Water Surcharge)”
• legislature.vermont.gov — “is the liability of the transferee of the title, unless fixed otherwise by agreement of the parties”

Worked example

A $400,000 home in Vermont, 20% down

Loan of $320,000 at 6.5%, closing on the 15th. Lender, title and recording figures are typical line items used for illustration, the same on every state page; the transfer tax and the owner’s policy side follow Vermont’s rules above. Not a quote: the calculator takes your own figures.

Questions

What people ask about Vermont

Who pays the transfer tax in Vermont?

Vermont charges a state transfer tax of 0.5% of the first $200,000 and 1.25% above $200,000 for a principal residence, plus a 0.22% Clean Water Surcharge on value above $200,000 (property transfer tax, 32 V.S.A. § 9602); non-principal residences 3.4% plus the surcharge, about 0.985% of the price, and the buyer customarily pays it.

Do you need an attorney to close on a house in Vermont?

In Vermont closings are customarily handled by an attorney rather than a title or escrow company, so budget an attorney fee.

Who pays for the owner’s title policy in Vermont?

The buyer customarily pays for the owner’s title insurance policy in Vermont, along with the lender’s policy.

How much are seller closing costs in Vermont?

On a $400,000 sale with a 5% commission, the worked example on this page comes to $23,500 for the seller, before the mortgage payoff and any concessions or repairs. The seller net sheet calculator shows the walk-away figure.