1. What is Net Proceeds Calculation?

The Net Proceeds calculation determines how much money you'll actually receive from selling your home after accounting for selling costs and paying off your mortgage. It's a crucial figure for planning your next home purchase or other financial moves.

2. How Does the Calculator Work?

The calculator uses the simple formula:

Where:

• \( \text{Selling Price} \) — The agreed sale price of your home
• \( \text{Selling Costs} \) — All associated costs of selling (agent commissions, closing costs, etc.)
• \( \text{Mortgage Payoff} \) — Remaining balance on your mortgage plus any prepayment penalties

Explanation: This calculation shows the actual cash you'll walk away with after selling your home.

3. Importance of Net Proceeds Calculation

Details: Knowing your net proceeds is essential for determining your budget for a new home, planning major purchases, or understanding your financial position after the sale.

4. Using the Calculator

Tips: Enter all values in USD. For most accurate results, use actual figures from your sale agreement and mortgage statement rather than estimates.

5. Frequently Asked Questions (FAQ)

Q1: What's included in selling costs?
A: Typically includes realtor commissions (5-6%), closing costs (1-3%), transfer taxes, and any seller concessions.

Q2: How do I find my mortgage payoff amount?
A: Contact your lender for a payoff quote, which includes principal plus any interest and fees.

Q3: Are there taxes on net proceeds?
A: For primary residences, capital gains up to $250,000 (single) or $500,000 (married) are typically tax-free if you've lived there 2+ years.

Q4: What if my net proceeds are negative?
A: This means you owe money at closing, which can happen if your mortgage balance plus costs exceed the sale price.

Q5: How accurate is this calculator?
A: It provides a basic estimate. For precise figures, consult with your real estate agent and lender.