Sander Scott walks through a seller's net sheet, the tool that shows how much money you actually take home after selling. He runs calculations at $600,000, $650,000, and $700,000 sale prices, breaking down commissions, taxes, title insurance, and mortgage payoff to show why net proceeds matter more than the sale price itself.
So what are seller's net sheets and why are they important? And why should your realtor be running a seller net sheet for you if you are considering selling your property? Well, a seller's net sheet is just that, what you can expect to net after the sale of your home, after all the expenses, after you pay the realtor or realtors involved. And if you're curious about who should pay for the buyer's agent commission, Check out my other video where I talk about that. But after you pay the realtors, after you pay the tax prorations, after you pay the transfer tax to the state, after you pay for title insurance, after you pay off a first or second mortgage or whatever, after all of the expenses are paid, what is it that you're going to leave closing with? Either a check or a wired transfer. This is a tool that's offered by most title companies, and your listing agent or the agent representing you as a seller ought to be able to have access to this tool and be able to run these estimates for you. So I'll just take you through what I do as I prepare seller net sheets for my seller clients. So I put in their name. I'm just going to use myself as an example here. The reason the address is important is because each township in the state of Michigan is going to have a different tax rate based on what taxes have been voted in, what millages. And then we're going to close in Traverse City, and I'm going to title this Sander's Example. Okay, then we come over here and I need to put in the proposed sale amount. So I'm going to do $600,000, uh, $650,000, and $700,000. Okay. And closing date, you pick a date into the future, and the date is important because your mortgage payoff and your tax prorations will factor into how those are calculated. So let's just choose the end of June, and let's say there's a mortgage payoff. I'm not letting you know what my mortgage is, but I'm just going to put in a $300,000 for the sake of the calculation. And also, I don't have any additional mortgages. Click that in there. And this is where I would put in the taxes and when they were paid. And then we come in here to the percentages. So we're going to say it's a 2.5% commission rate for both the buyer's and the seller's agent and no broker fee. Some brokerages charge a brokerage fee. If you're curious about whether you as a seller need to pay the buyer's agent commission, check out my other video where I talk through that and why I think it's kind of a moot point. I get into that in that video, but let's keep moving here with the seller's net sheet. And so these are all things that we could add in here, you know, is the, is there a well and septic? So a service that I provide a lot of my sellers is I'll fill out and pay for the required point of transfer or point of sale well and septic inspection. I pay for those and then get reimbursed at closing. So that would be entered in here. What other fees could be associated? And just for simplicity's sake, let's get this calculator to run. So here's the first big calculation, $600,000 minus $300,000. Okay. We didn't put in any property taxes, so there's nothing there. Here's 2.5% of $600,000 is $15,000 to both the listing broker and the buyer's agent. That's what this would be. It's kind of confusing. They call it a selling broker, but it's really the buyer's agent commission. Commission goes here. Actually, the, the money doesn't go directly to the agent. The money goes to the brokerage, and then the brokerage pays the agent. And then we have county transfer tax, state transfer tax— look at how much state transfer tax is— okay, closing fee, all these things. So this is what I would net if I sold at $600,000 with buyer's agent commissions but totaling 5%, 2.5 on each side and all that. That's what I would net. Okay, at a $650,000 price point, that's what I would net. And at a $700,000 price point, that's what I would net. So these can be very important when sellers are planning their next move. What are they going to do or what do they want to afford? And a lot of times this is the biggest driver in their decision-making on how to market their property. Obviously, other factors like comparable sales, what the market is doing, whether or not there is a hole in the market. There are lots of different factors that go into a pricing strategy or deciding on a price of a home. And I've shot a whole separate video on pricing strategy. You might want to check that out. But this is a part of a pricing strategy, knowing what you will net, because typically almost every seller that I've worked with, they have plans for the money. That they're going to net, and they want to know how much it is so that they can plan their next move.
