Accrued Closing Expenses

What are Accrued Closing Expenses in Real Estate?

Accrued expenses are those seller-paid closing costs that have been accumulated but not yet paid by the seller. Real estate taxes are a prime example, because they are often billed and paid in arrears, so the 2005 tax bill may be for real estate taxes incurred in 2004.

At a purchase closing, the parties won’t have a bill from the county or taxing authority confirming what the seller owes — but both parties know that the seller does owe accrued taxes on the property. They or their attorneys will then estimate the amount of real estate taxes owed by prorating the unpaid days based on the previous bill.

For more information, see also the following entries:

  • :Arrears:
  • :Closing:
  • :Closing Costs:
  • :P urchase Loan:
  • :Real Estate:
  • :Real Estate Tax:
  • :Real Property:
  • :Settlement:
  • :Settlement Statement:



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