Seller Net Sheet Explainer: Projecting Your Home Sale Proceeds
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Jacob Burdis, Contributing AuthorClose
Jacob Burdis Contributing AuthorJacob Burdis, PhD is a professional dabbler with experience in entrepreneurship, educational technology, digital language learning, product management, and real estate investing.
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Sam Dadofalza, Associate Refresh EditorClose
Sam Dadofalza Associate Refresh EditorSam Dadofalza is an associate refresh editor at HomeLight, where she crafts insightful stories to guide homebuyers and sellers through the intricacies of real estate transactions. She has previously contributed to digital marketing firms and online business publications, honing her skills in creating engaging and informative content.
As home values steadily increase, a lot of homeowners are looking for ways to cash in on their growing equity. If you’re thinking about selling, you’re probably wondering how much of that extra value will end up in your pocket after all the fees and expenses. A seller’s net sheet is a great way to get a clear idea of what you can really expect to take home.
Just because you’ve estimated your home value at $500,000 and your mortgage balance at $250,000, doesn’t mean you’ll walk away with the remaining $250,000. It’s not quite that simple. Selling a home costs money, and you’ve got to factor in all the expenses to get an accurate estimate of what your take-home amount will be once the sale is complete.
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A seller’s net sheet is a document that estimates how much cash you can expect to walk away with after subtracting fees and expenses from the sale price of your home.
In this guide, you’ll come to understand the ins and outs of the seller’s net sheet through our research and interviews with experts such as Mel Black, a real estate attorney and appraiser, and Alex Saad, an appraiser turned real estate agent who sells properties 65% quicker than the average agent in Dearborn, Michigan.
What is a seller’s net sheet?
A seller’s net sheet is one of those essential home sale documents providing an itemized list of all of the factors that contribute to an accurate estimate of the amount of money a homeowner can expect to receive after selling a home.
“It breaks down all of your costs as a seller and gives you a good idea of what you’ll get for your home,” explains Saad.
A seller’s net sheet removes much of the mystery surrounding how much money you’ll actually receive from selling your home. As a high-level rule of thumb, sellers can expect to pay a 3% to 5.8% average in agent commissions and 1% to 3% in closing costs. The net sheet helps you see exactly where that money is going.
What numbers typically appear on the seller’s net sheet?
What appears on a seller’s net sheet varies by state and provider, but not radically. While there is no standard net sheet, most will contain the same information, even though the format may differ.
Saad summarized the items on a seller’s net sheet: “We start with the sales price, subtract the mortgage balance, and then subtract the other costs associated with the sale, such as Realtor® commissions, taxes, title fees, and other miscellaneous fees.”
We’ve collected an example of a seller’s net sheet by Diane Grove, a top-selling agent in the Fort Worth, Texas area. Below are the details based on an actual net sheet created for a home seller (slightly adjusted to simplify and reflect current costs).
On this sheet, most of the figures are based on selling a home with a conventional loan. Be aware that the costs may differ based on the type of financing originally used to purchase the home. For example, a home purchased with cash wouldn’t have to subtract the mortgage payoff.
Sales price
- Sale price: +$500,000
Mortgage balance payoff
- First mortgage payoff: -$250,000
Agent commission
- Share of commission for seller’s agent: -$15,000 (3% of the sale price)
- Share of commission for buyer’s agent (optional): -$15,000 (3% of the sale price)
Seller’s portion of closing costs (title fees, taxes, and escrow)
- Owner’s title insurance: -$3,250 (usually between 0.5%-1.0% of the sale price)
- Title document preparation fees: -$175
- Recording fee: -$125
- Prorated property tax: -$7,250
- Tax certificate: -$45
- Escrow fee: -$450
- Title company e-file fee: -$10
Miscellaneous
- Seller-provided home warranty for the buyer: -$450
- Closing costs credit to the buyer: -$500
- Estimated inspection repairs: -$500
- Estimated escrow refund from the lender: +$7,100
Overall Breakdown
| Sales price | $500,000 |
| Mortgage payoff | ($250,000) |
| Agent commissions | ($30,000) |
| Seller’s closing costs | ($11,305) |
| Miscellaneous costs | ($1,450) |
| Estimated costs to close | ($292,755) |
| Estimated net at closing | $207,245 |
| Escrow refund from lender | $7,100 |
| Estimated net after refund | $214,345 |
Seller’s net sheet vs. buyer’s cost sheet
Both the seller and the buyer incur costs during a home purchase. While a seller’s net sheet outlines estimated profits after fees and expenses, a buyer’s cost sheet itemizes the factors contributing to the buyer’s costs when purchasing a home.
Be careful not to confuse a seller’s net sheet with a buyer’s cost sheet. “They analyze the same transaction and may appear alike, but they analyze different data for different purposes,” Black says. “Make sure you know the difference.”
According to Allstate, one of the country’s largest home insurance companies, items that you could see on a buyer’s cost sheet include:
- Appraisal fee
- Credit report fee
- Inspection fee
- Legal fees
- Title insurance
- Title search fee
- Document-recording fees
- Escrow fees
- Taxes
Who prepares the seller’s net sheet?
Typically, the listing agent prepares the seller’s net sheet prior to listing the home in order to give sellers appropriate expectations for what they may profit from the transaction.
“I always have a net sheet and every time we get a new offer, I do a new net sheet,” explains Saad.
Your listing agent may craft a seller’s net sheet with an Excel spreadsheet, real estate software, or even an online form or calculator. They’ll present the sheet as a printed-out document, in a digital format such as a PDF or spreadsheet, or as part of a PowerPoint presentation.
“Relying on a faded piece of paper to serve as a net sheet isn’t the most professional way to go,” Black stresses.
Additionally, most title escrow officers will also provide this information, and many title companies even have an online calculator.
While it’s not a seller’s net sheet, HomeLight provides a free net proceeds calculator you can try right now to see a ballpark estimate of how much it might cost to sell your home and the proceeds you could earn from the sale.
I always update the net sheet every time we get an offer. This helps the seller make better decisions so they can see the bottom line every time. Once they see the final estimate, they can better understand which offer to take, or whether to change the sale price.
As a home seller, when do I receive a seller’s net sheet?
Typically, a listing agent provides homeowners with the seller’s net sheet before the home is listed in order to help determine the proper list price. But ideally, according to Saad, your agent will provide multiple net sheets at different points during the transaction.
These stages include:
- When you set the list price
- When prospective buyers make offers
- Throughout a transaction when figures shift due to negotiations
“I always update the net sheet every time we get an offer. This helps the seller make better decisions so they can see the bottom line every time. Once they see the final estimate, they can better understand which offer to take, or whether to change the sale price,” says Saad.
At the time of closing you’ll also receive a separate — and more official — document called the seller’s closing statement or settlement statement, which is an itemized list of fees and credits that shows your net profits as the seller.
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Is an agent required to supply a seller’s net sheet?
The simple answer is no. Your real estate agent isn’t required to provide a seller’s net sheet. In other words, if your agent doesn’t provide one, you might need to ask for it.
“Whether you should insist on having one depends on your individual situation,” says Cornelius Charles, co-owner of Dream Home Property Solutions LLC, a Ventura, California-based residential real estate investment company with an A+ rating from the Better Business Bureau (BBB).
“If you have bought and sold multiple homes throughout your life, you probably have a pretty good feel for the expenses involved with doing so… [but] first-time home sellers are usually not aware of all of the expenses involved with selling a home and can make the mistake of thinking they are going to pocket close to the full amount of the sale price.”
Similarly, if the amount you owe on the mortgage comes close to the sale price, you’ll probably want to ask for a seller’s net sheet to ensure the proceeds will cover most or all of your expenses.
What are some common mistakes to avoid when reviewing the seller’s net sheet?
When reviewing your seller’s net sheet, it’s important to go over each detail so you have a realistic expectation of your home sale proceeds. Even small oversights can lead to surprises at closing, so take the time to double-check everything for a clearer idea of what you’ll actually walk away with. Avoid these common blunders:
- Underestimating closing costs: Many sellers focus on the sale price but overlook the full scope of closing costs, which can include transfer taxes, title fees, and other charges that add up quickly.
- Forgetting prorated property taxes: Property taxes are often prorated at closing, and forgetting to include these can result in unexpected deductions.
- Miscalculating mortgage payoff amounts: Sellers should always double-check their mortgage payoff balance, as incorrect or outdated amounts can impact their net proceeds.
- Overlooking agent commissions: Sometimes sellers overlook how much commissions can take out of the sale price. Keep in mind that you’re responsible for your listing agent’s fee, and if you agree to cover the buyer’s agent commission too, that adds to your costs.
- Ignoring necessary repairs or concessions: If repairs or concessions were agreed upon, failing to account for these expenses can lead to a lower net amount at closing.
Q&A: More expert tips and insights about the seller’s net sheet
Can I trust the estimate on a seller’s net sheet?
The estimates provided on a seller’s net sheet are just that — estimates. The accuracy of the estimate depends highly on the experience and knowledge of the person preparing it.
“A lot of agents will give the sellers the net sheet at a higher price than what they think it will actually sell for in order to win their business,” warns Saad. It is vital to properly screen your listing agent to ensure they have the proper experience to provide realistic estimates.
Can there be additional costs that aren’t on the net sheet?
In most cases, the seller’s net sheet will capture all of the costs associated with the real estate transaction. However, in exceptional cases, additional costs may be discovered before closing.
Saad has experienced times when a seller had a forgotten lien on the home from an unpaid contracting job years prior. “We don’t find that out until we pull the title and see the lien on the home,” explains Saad. These exceptional cases are exactly why title searches and title insurance are so important to real estate transactions.
Which costs are most often misunderstood?
For many sellers, especially those selling a home for the first time, many of the costs associated with selling a home are new and misunderstood.
According to Saad, tax proration and title insurance are the costs that generate the most questions from sellers after he has presented the seller’s net sheet. When sellers are surprised about title insurance, Saad explains, “You want to assure the new buyer that there aren’t any liens or judgments on the property, reassuring them that these won’t pop up later.”
Get the best bottom line by partnering with a top real estate agent
How the agent provides a seller’s net sheet is often a great way to determine if they are the right agent for you. If you find your agent is struggling to answer your questions or produce the documentation and details you’re looking for, it may be time to consider listing with another real estate agent with a proven track record of success.
Be sure to check the details of your listing agreement before you make any moves. Then, start your search for a top-selling real estate agent in your area with HomeLight. We’ll match you with three top agents near you based on their actual performance history. From there, you get to pick the best one to meet your individual needs.
If you’re curious about what your home might be worth right now, try HomeLight’s Home Value Estimator. This free online tool can provide a ballpark estimate of your home’s worth in less than two minutes.
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