Today’s blog is about reading, preparing and understanding a Seller Net Sheet.
Numbers are a bit of a yawner. Okay, they can be a full-on snooze, but stick with us here, we’ll get through the Seller’s Net Sheet as quick as we can, and at the end, you will understand what it is, how to calculate your own, and who to ask to do it for you if you have NO desire to prepare your own seller net sheet!
Whether you’re using the proceeds of sale to buy a new home, fund your retirement, invest in the latest greatest stock or to finance your next wild and crazy adventure, you need a realistic estimate of how much you’ll be taking home. The Seller Net Sheet is intended to give you a reasonable estimate of how much money you will receive from the sale of your home after the costs and expenses of selling have been deducted. Important, right?
The arithmetic is simple enough that you may well be want to do it on your own, here is what you do (we have included an example using a home that is listed at $350,000, has property taxes of $3,000 that are unpaid for the current year, HOA fees of $100/month that are prepaid paid to the end of November and an outstanding balance of $160,000 including fees and penalties on the mortgage the sale is set to close on October 31. We have also set a repair and concession budget of $5,000):
|Start with:||Estimated Sale Price
(95% of list price is a good place to start)
|$350,000 x .95||$332,500.00|
Keep in mind, each agent sets their own commission,
and this number varies.
(In Maricopa County we use .008 as our multiplier
but beware that this number will be different
depending on your state and/or county so check
with your local title company)
(The escrow fee is generally split equally between
the buyer and the seller, so we use a multiplier of
.00285, but again, check this number with your
|Subtract:||Unpaid Property taxes
owed by you up to the closing date.
|(3,000/12) x 10||-$2,500.00|
|Add:||Prepaid Property taxes
you’ve paid that go beyond the closing date
|Subtract:||Unpaid HOA fees
owed by you up to the closing date
|Add:||Prepaid HOA fees||$100||$100.00|
The amount you’ll owe on your mortgage
including interest and penalties, if any,
on the closing date. You’ll be able to get
this number from your lender
|Subtract:||Repairs & Concessions
Agreed upon repairs and concessions.
You won’t know these numbers until you’re
well into the sale process, so you may want
to set a budget for repairs now and then stick
with it when the time comes
|Subtract:||Anything else you’re aware of that needs to be
paid from the sale proceeds such as other loans
that are secured against your home
|TOTAL:||This is where your net proceeds number will go
when you’ve completed the above arithmetic!
If numbers drive you crazy, your REALTOR®, title company and mortgage company are all well equipped to prepare a seller net sheet for you plus there are several online options as well.
If we have confused you to death, just give us a call, text or email us or by using the form below. We would be delighted to help you figure out your seller net sheet.
That’s it for today! In our next blog post, we will talk about how to price your home; you’re not going to want to miss that!
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