Do You Get All The Money When You Sell Your House?


Pamela Harris

When you sell your homeyour buyer’s lender pays you based on the amount of equity you have in your home. Using the previous example of a $200,000 home with 50% equity, you will receive $100,000 from the sale. The seller’s lender would then transfer the remaining $100,000 to your original mortgage lender.

Real estate agents are in business to make money, so you’ll have to pay yours for the time and effort he put into finding a buyer and negotiating the sale. Real estate agents are paid on a commission basis, as much as 6 percent of the sales price of your home. The exact percentage depends on the terms of your listing agreement, and sometimes you can negotiate it downward. Assuming your real estate agent has agreed to a 6 percent commission, he typically receives 3 percent of that, and the buyer’s real estate agent also receives 3 percent. If you sell your home for $400,000, you’ll pay the realtors $24,000, unless you also negotiate with your buyer to pay some of this cost. If your mortgage was $300,000, you’ve now got $76,000 left.

Closing costs

The buyer typically pays most closing costs, but sellers often face some closing costs, too. These fees can amount to as much as 1% to 3% of the purchase price of the house. Everything from recording fees to title insurance premiums can come out of the sales price of the house—aka the money the buyer pays to the seller—as part of closing.

And you guessed it, these fees will be paid during the process, so they’ll come right out of the money left over after you pay off your mortgage.

Selling During Winter Months

Believe it or not, there really is a right time to sell during the year. Winter, especially around the holidays, is typically a slow time of year for home sales. People are busy with social engagements, and the cold weather across much of the country makes it more appealing just to stay home. Because fewer buyers are likely to be looking, it may take longer to sell your home, and you may not get as much money. However, you can take some consolation in knowing that while there may not be as many active buyers, there also won’t be as many competing sellers, which can sometimes work to your advantage.

You may be better off waiting. Barring any mitigating circumstances that may force you to sell during the winter or holidays, consider listing when the weather begins to warm up. People are usually ready and willing to purchase a home when it’s warmer


Property tax

Sellers also need to remember property taxes, which are dependent on if they are escrowing into their mortgage, Lopez says. Property taxes are usually paid in advance. The seller should pay the prorated share of property tax up to the closing date, with the money placed in escrow.

However, if you’re selling your home and have already paid taxes for the year, you may actually get a rebate at closing. The buyer will reimburse the seller for the portion of taxes already paid that apply after the closing date.


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