Your net proceeds equal the sale price minus your remaining mortgage balance, real estate commissions, seller closing costs, and any agreed-upon repairs or concessions. A good rule of thumb is that total selling costs run 8-10% of the sale price.
Getting an accurate estimate before you list helps you make informed decisions about pricing, repairs, and your next move.
The Net Proceeds Formula
Net Proceeds = Sale Price minus (Mortgage Payoff + Real Estate Commission + Seller Closing Costs + Repairs/Concessions + Transfer Taxes). Your mortgage payoff includes the remaining principal balance plus any prepayment penalties if applicable. Request a payoff statement from your lender, which includes interest through the projected closing date.
Typical Deductions
Real estate commissions typically total 5-6% of the sale price, split between the listing agent and the buyer's agent. Seller closing costs include title insurance, escrow fees, recording fees, and pro-rated property taxes, usually 1-3% of the sale price. Transfer taxes (document stamps) vary by county in Texas. You may also have agreed to seller concessions such as repair credits or closing cost assistance for the buyer.
How to Get an Accurate Estimate
Start by getting your home's estimated market value from a comparative market analysis (CMA) performed by your real estate agent. Subtract your estimated mortgage payoff from your lender. Add up estimated commissions, closing costs, and any known repairs or concessions. The result is your estimated net proceeds.
As a dual-licensed loan officer and realtor, I can walk you through the numbers so you know exactly what to expect. Contact me for a personalized net proceeds estimate before you list.
