What a net sheet is and how it is built
A net sheet works backwards from the sale price to the money that reaches you. Listing agents produce one before a property goes on the market and again with every offer, because the price on the contract and the number a seller receives are separated by a list of deductions most people underestimate.
The deductions fall into three groups, and keeping them apart is what makes the sheet readable.
Costs that scale with the price. Commission and transfer tax are percentages, so they move whenever the price moves. Together they are the reason a $10,000 price reduction does not cost you $10,000 — at a 5.5% combined rate it costs $9,450, because the percentage-based deductions shrink too.
Fixed costs. Owner's title policy where you pay it, escrow or attorney fees, HOA resale documents, home warranty, courier and recording charges, and any negotiated concession or repair credit. These stay the same whether you sell for $400,000 or $500,000, which is why they hurt more on a lower-priced house.
The payoff. Your mortgage balance plus interest through the day the funds actually arrive at the servicer, plus any second lien, HELOC balance, solar loan or judgement. This is the largest number on most net sheets, and it is not a cost of selling — it is a debt you already owed, which is why this calculator reports it separately from selling costs.
The payoff is bigger than your statement says
Two things make a payoff quote exceed the principal balance you see in your online account, and both surprise sellers.
Per-diem interest. Mortgage interest is paid in arrears, so a payment on 1 June covers May. If you close on 20 June, you owe interest for those twenty days, plus however long the wire takes to reach and be applied by the servicer. Servicers quote a payoff good through a specific date and add a per-diem for each day beyond it. On $260,000 at 6.25%, that per-diem is $260,000 × 0.0625 ÷ 365 = $44.52 a day, so twelve days adds $534.25.
Everything else attached to the loan. Recording fee for the release of lien, a payoff or demand statement fee where permitted, any escrow shortage, and any prepayment penalty if your note has one. Against that, a positive escrow balance is refunded — but usually by cheque a few weeks after closing rather than as a credit at the table, so it does not appear in your net proceeds.
Order the payoff quote through your closing agent rather than estimating it. It is free, it is binding through its stated date, and the difference between a real quote and a statement balance is routinely several hundred dollars.
If you have a HELOC, ask the lender to close the line as well as pay it. A line that is merely paid to zero can still be drawn against before the release records, which will hold up your closing.
Worked example: a $450,000 sale with a $260,000 mortgage
You expect $450,000. Your mortgage principal is $260,000 at 6.25%, and the payoff will carry twelve days of interest. Commission is 5% total, the county charges the seller a 0.5% excise tax, title and escrow come to $1,800, the HOA charges $400 for the resale package, property tax is $4,800 a year with 150 days owed at closing, you agreed a $2,500 repair credit after inspection, and $500 covers a home warranty and wire fees.
- Commission. 5% × $450,000 = $22,500.
- Transfer tax. 0.5% × $450,000 = $2,250.
- Tax proration. $4,800 ÷ 365 × 150 = $13.1507 × 150 = $1,972.60.
- Fixed costs. $1,800 + $400 + $2,500 + $500 = $5,200.
- Total selling costs. $22,500 + $2,250 + $1,972.60 + $5,200 = $31,922.60, which is 7.09% of the price.
- Payoff per-diem. $260,000 × 0.0625 ÷ 365 = $44.5205 a day.
- Payoff interest. $44.5205 × 12 = $534.25.
- Total payoff. $260,000 + $534.25 = $260,534.25.
- Net proceeds. $450,000 − $31,922.60 − $260,534.25 = $157,543.15.
- Net as a share of price. $157,543.15 ÷ $450,000 = 35.01%.
The break-even follows from the same figures. Costs that scale total 5.5%, so the price must satisfy P × 0.945 = fixed costs + tax proration + payoff = $5,200 + $1,972.60 + $260,534.25 = $267,706.85. That gives P = $267,706.85 ÷ 0.945 = $283,287.67. Anything above that clears the table; anything below it and you are bringing money.
Reading the sheet before you accept an offer
Net proceeds is the only number to compare offers on. A $455,000 offer asking for a $6,000 closing-cost credit nets you less than a $452,000 offer with no credit, because the credit comes off your side in full while the extra $3,000 of price is worth only $2,835 after 5.5% of percentage costs. Run every offer through the sheet rather than ranking them by headline price.
Selling costs as a percentage of price is the sanity check. In the worked example it is 7.09%, of which commission alone is 5%. If your figure is materially higher, look for the cause — an unusually high transfer tax jurisdiction, a large concession, or a repair credit that has grown through negotiation.
The break-even price matters most when equity is thin. If the break-even sits close to your expected price, you have very little room: a further repair credit, an appraisal shortfall, or a delayed closing that adds payoff interest can all push a sale below the point where it funds itself. Sellers in that position should establish the number before listing, not after an offer arrives.
Net proceeds is not taxable gain. They are unrelated calculations that people conflate constantly. Proceeds depend on how much you borrowed; gain depends on what you paid and improved. A seller who refinanced heavily can receive almost nothing at closing and still owe capital gains tax, and a seller who owns free and clear can receive a large wire on a sale that produces no taxable gain at all. Run the tax side separately with the home sale capital gains calculator.
Net proceeds across a range of sale prices
| Sale price | Selling costs | Net proceeds | Net as % of price |
|---|---|---|---|
| $400,000 | $29,172.60 | $110,293.15 | 27.57% |
| $425,000 | $30,547.60 | $133,918.15 | 31.51% |
| $450,000 | $31,922.60 | $157,543.15 | 35.01% |
| $475,000 | $33,297.60 | $181,168.15 | 38.14% |
| $500,000 | $34,672.60 | $204,793.15 | 40.96% |
Every $25,000 of price is worth $23,625 of net proceeds — 94.5 cents on the dollar, because 5.5 cents goes to commission and transfer tax. Net as a percentage of price rises steeply because the fixed payoff does not move.
A net sheet is an estimate; the settlement statement is the fact
Every figure here depends on inputs that firm up only as the transaction proceeds: the actual payoff quote, the closing date, the final prorations, and any credit negotiated after inspection or appraisal. Transfer tax rates and the custom about who pays them vary by state, county and city, and title and escrow charges vary by provider.
Get a preliminary settlement statement from your closing agent as soon as one is available and reconcile it against this sheet line by line. Where they differ, the settlement statement governs. This page is a planning tool, not legal, tax or accounting advice.
Lines sellers forget
- Payoff interest and release recording. The payoff exceeds the statement balance every time, by the per-diem times the days to funding.
- HOA resale documents and estoppel fees. Ordered days in advance, often several hundred dollars, and sometimes charged with a rush fee.
- Repair credits agreed after inspection. They come off your proceeds in full and do not reduce the price the commission is calculated on.
- Buyer closing-cost concessions. Economically identical to a price cut of the same size on your side, but they leave the commission base untouched.
- Property tax proration in the direction you owe it. If the tax period is unpaid through your ownership, the buyer receives a credit from you at closing.
- A second lien, solar loan or contractor's lien you had forgotten. Title will find it, and it must be released for the sale to record.
- Capital gains tax, which is not on the settlement statement at all and arrives with your tax return the following spring.
- Moving costs and any post-closing occupancy agreement, which can carry a daily rent back to the buyer.
The rest of the picture
Once the sheet balances, three other calculations complete the sale. The commission calculator breaks the largest line into its listing and buyer sides so you can see what each brokerage is being paid and negotiate each separately. The property tax proration calculator gets the day count right, which matters because the direction of the credit depends on whether your jurisdiction bills taxes in advance or in arrears. The transfer tax calculator handles jurisdictions that stack state, county and city rates or use tiered brackets.
On the tax side, run the home sale capital gains calculator before you spend the proceeds. Selling costs from this page reduce the amount realised, and capital improvements raise your basis, so both belong in that calculation — but the loan payoff does not appear in it at all.
If you are buying as well as selling, the closing costs calculator builds the other side of the transaction, and your net proceeds here become the down payment and cash to close there. Investors selling a rental should also check the depreciation recapture calculator, because the depreciation claimed over the holding period is taxed on sale regardless of how little cash arrives at closing.