How to calculate your net proceeds from a home sale

Your net proceeds are the money that actually reaches your account after a sale: the price, minus the payoff on every loan or lien against the house, minus the costs of selling, adjusted for property tax and HOA prorations. Agents and title companies put this on a document called a seller net sheet, and you can build a reasonable one yourself with your mortgage statement and a few quotes. The goal is not accuracy to the dollar. It is comparing every offer, and every way of selling, on the number you keep instead of the headline price.

What goes into a seller net sheet?

Work from the top down. Every line below either comes out of the sale price or adjusts it.

1. Sale price. The contract price, or the offer you are evaluating.
2. Mortgage payoff. Not the balance on your monthly statement, but the payoff amount, which includes interest through the payoff date and any fees. Your servicer provides it on request.
3. Other liens. A home equity loan or line of credit, a solar loan recorded against the property, unpaid property taxes, HOA balances, or judgments. Each must be paid off or released at closing for the buyer to get clear title.
4. Commissions. If you list with an agent, the listing side, plus whatever you agree to pay a buyer's agent, if anything.
5. Seller closing costs. Title and settlement or escrow fees, transfer taxes where your state or county charges them, recording fees, and attorney fees in places where attorneys handle closings.
6. Concessions and credits. Money you agree to put toward the buyer's costs, and any repair credits from the inspection negotiation.
7. Prorations. Property taxes and HOA dues are split by date. Depending on whether property taxes where you live are paid in arrears or in advance, this is a charge or a credit.
8. Prep and carrying costs. Repairs, cleaning, staging, and each month of mortgage, taxes, insurance, and utilities while the home is on the market. You pay these out of pocket rather than at closing, so they never appear on the closing statement, but they still come out of what you keep.

Where do you get each number?

• Payoff amounts: request a payoff statement from your mortgage servicer and from any other lender with a lien. Ask for a payoff good through your expected closing date.
• Commission: your listing agreement states it, and it is negotiable before you sign.
• Closing costs: a title company, escrow company, or real estate attorney can estimate them for your price and location. Transfer tax rates are published by your state or county.
• Prorations: your latest property tax bill and HOA statement.
• Carrying costs: add up your monthly housing bills, then multiply by the months you expect to be on the market plus the closing period. Current days on market where you live is a reasonable starting point.
• Price: for a listing, use a realistic sale price from recent comparable sales or an agent's written market analysis, not the hopeful list price. For a cash sale, use the offer in writing.

For typical ranges on commissions, concessions, and closing costs, our guide to the cost of selling a house covers each one. Use those ranges to sanity-check your quotes, and put your own quotes on the sheet.

What does the math look like on a real sheet?

Here is the arithmetic with hypothetical round numbers, chosen only to show the structure. Suppose you accept an offer of 400,000 dollars, your payoff statement shows 250,000 dollars, and your quotes for commission, closing costs, and a small repair credit add up to 30,000 dollars. Your net before prorations is 400,000 minus 250,000 minus 30,000, or 120,000 dollars. If property taxes where you live are paid in arrears and you owe the buyer a proration credit, that comes off too. Then run the same sheet for every other offer or path you are considering.

How do you compare a cash offer to a listing on net?

Build two columns on the same sheet, one for each path, and fill in every line honestly.

• Cash column: the offer price, minus any service or program fee, minus deductions for repairs after the buyer's inspection, minus the closing costs you still pay, minus your loan payoffs. Commissions and carrying costs are usually small or zero, because there is typically no agent and the sale closes quickly.
• Listing column: a realistic sale price, minus commissions, concessions, prep, closing costs, and loan payoffs, minus carrying costs for your local days on market plus the closing period.

Subtract the cash net from the listing net. The difference is what speed, certainty, and skipping repairs cost you. Divide it by the number of weeks the cash sale saves, and you have a price per week that is easy to judge against your own deadline, your carrying costs, and the risk of a deal falling through. Our guide to cash offers versus listing runs a full worked example of this comparison.

What surprises sellers on closing day?

• A payoff higher than the last statement, because interest accrues daily until the loan is paid.
• A lien you did not know about, such as an old judgment or an unreleased loan, found in the title search.
• HOA transfer, document, or estoppel fees charged at sale.
• Tax prorations that land as a credit to the buyer.
• Final utility bills, and any home warranty you agreed to provide.

Two items live outside the closing statement. Your old escrow account balance is refunded by your servicer after the loan is paid off, usually within a few weeks. And taxes on any gain are handled on your tax return, not at closing. Under the IRS rules described in IRS Publication 523, owners who owned and lived in the home as their main home for at least two of the five years before the sale can generally exclude up to 250,000 dollars of gain, or up to 500,000 dollars on a joint return, but the rules and exceptions depend on your situation, so check with a tax professional.