A seller’s net sheet can help potential sellers to make a rough estimate of the total costs involved in a real estate transaction and get an idea of how much they stand to make upon successful completion of a sale. Having a seller’s net sheet can also assist in setting a realistic price for a property. You can use prepare the seller’s net sheet yourself or ask your real estate agent to do it for you.
You can use simple pen and paper to prepare your net sheet or you can take the help of an experienced real estate agent to make the calculations. A step by step method to get a seller’s net sheet is described ahead:
How to Create a Seller’s Net Sheet
- The first step in creating a net sheet is to determine a sales price. Set a realistic sales price that you will be asking from your prospective buyers as it will have a bearing on some of the costs involved as you go further with the process of preparing your net sheet.
- Take into account the commissions that are going to be paid to the real estate agent or attorney. In most cases this amount will be a percentage of the actual sale price but some agents might have a flat fee. If in your case it is a percentage based commission, simply multiply the percentage by the sales price. For example, $500,000 sales price with a 6% commission will amount to $30,000.
- Ask your title company about the total cost of your title insurance. In most cases a seller will be responsible for buying a title policy for the buyer and the amount will vary depending upon the sale price of the property.
- Ask your title company if there are any escrow fees, transfer fees, and any other fees involved with selling your property.
- Have a look at your last property tax bill. Examine and take into account if you are bound to pay any back taxes at the estimated time of closing the transaction.
- Get in touch with your mortgage company and inquire what the payout on your loan will be on the estimated date of transaction close.
- If you have any other liens on the property, include those in your calculations as well. Apart from these, any other taxes or real estate fees applicable in your area are also required to be taken into account.
- Add up all the figures from steps 2 through 7 and subtract from the total amount in the first step which is the estimated sales price of your property. This will be your estimated net when the transaction closes.
Calculating Seller’s Net Sheet
Calculating a seller’s net sheet is important in order to gauge the net proceeds at the end of the real estate transaction. This is a very easy to follow method and even first time sellers with no prior knowledge of how to calculate and estimate a realistic sale price can do it on their own. If you need assistance in calculating a net sheet, contact a skilled real estate agent today. This valuable tool will help you get a better price for your home.