A seller closes on a property for $550,000. The commission is 5%, other seller closing costs are $8,200, and the existing mortgage payoff is $230,000. What are the seller's net proceeds before any tax effects?
Correct Answer
C) $284,300
Step 1: Commission = $550,000 × 5% = $27,500. Step 2: Net proceeds = $550,000 − $27,500 − $8,200 − $230,000 = $284,300.
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Related Topics & Key Terms
Key Terms:
Related Concepts
Net Operating Income (NOI) is the revenue a property generates after deducting all operating expenses.
Converting a percentage to a decimal involves dividing the percentage value by 100.
In real estate, property value can be estimated by dividing the Net Operating Income (NOI) by the Capitalization Rate (Cap Rate).
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