please help me understand something about selling

[Anonymous]

We bought our house for $355K in 2004. Assuming we want to clear, say, $100K when we sell, how much do we have to sell it for, in order to cover both realtors, and any of the other things the seller has to cover (taxes, etc.)? Sorry for my ignorance - this is my first time selling!!!

[Anonymous]

You are going about this in the wrong order. You don't get to decide how much you want to clear. The market is going to determine that. Check for information on similar homes in your area to get a sense of what they are selling for. Make appointments with 3 realtors and ask them to come up with a price and percentage they will charge. They will do this for free and break down the costs for you. and then you'll have a idea of what kind of money you will get for the sale of the house.
Believe me, if you make your list price too high just because you really, really want it to sell for that much, your house will not sell.

[Anonymous]

depends on a lot of things including amount of realtor commission. But assume 6% to cover both a 5% realtor fee and other costs.

But it is sort of an irrelevant question, because the fact that you want to clear $100K won't influence how much people are willing to pay for your house.

[Anonymous]

Also, when you say "clear" do you mean what you take home from the deal at the end of the day, or what you make in profit on the house? Because your cash in hand is going to depend on your mortgage balance, not your purchase price.

[Anonymous]

OP back. We are not selling anytime soon. We will pretty much decide to sell when we can clear the amount we need. (Not necessarily $100, but I was picking that as an easy round # to work with.) Does this help elucidate my question a bit more? Sorry my first query was not written clearly in this aspect

[Anonymous]

Yeah . . . what they said. We bought for about $325 in 2003 and sold for $385 in 2009 and basically broke even when we considered the money for improvements we'd put in over that time plus commissions and so forth. The market decides how much you'll clear, not you...

[Anonymous]

Anonymous wrote:OP back. We are not selling anytime soon. We will pretty much decide to sell when we can clear the amount we need. (Not necessarily $100, but I was picking that as an easy round # to work with.) Does this help elucidate my question a bit more? Sorry my first query was not written clearly in this aspect

No, not really. You're not expressing yourself very well. PP's question was a good one -- do you want to walk away from the table with $100,000 or do you want to earn a $100,000 profit? (or whatever figure you have in mind...).

Assuming it's profit, you'd need to sell it for about $485,000 (which is $355,000 plus $100,000 plus about $30,000 for commissions and other closing costs.)

[Anonymous]

There are many more pieces of information that we need. As mentioned, do you want $100K profit over what you bought for or walking away from the table with $100K in hand? What is your current mortgage balance (e.g. how much have you paid off)? Is your home in decent condition? Have you taken good care of it? Are the appliances in good and sellable condition or will buyers be inclined to ask for either a home warranty or to have appliances replaced? Are there hidden issues? (Plumbing, electrical, wall damage, potential mold or insect issues). All of these are likely to affect your bottom line.

[Anonymous]

Transfer taxes should be included. Depends on jurisdiction. believe maryland/ montgomery is around 2.5% all total between the various taxes. i think it is higher than other local jurisdictions.

[Anonymous]

Anonymous wrote:

Anonymous wrote:OP back. We are not selling anytime soon. We will pretty much decide to sell when we can clear the amount we need. (Not necessarily $100, but I was picking that as an easy round # to work with.) Does this help elucidate my question a bit more? Sorry my first query was not written clearly in this aspect

No, not really. You're not expressing yourself very well. PP's question was a good one -- do you want to walk away from the table with $100,000 or do you want to earn a $100,000 profit? (or whatever figure you have in mind...).

Assuming it's profit, you'd need to sell it for about $485,000 (which is $355,000 plus $100,000 plus about $30,000 for commissions and other closing costs.)

Thanks so much. We would like to walk away from the table with $100,000 (or whatever figure we have in mind). So we would need to sell it for more than $485,000, which is $355,000 plus $100, plus about $30,000 for commissions and other closing costs, b/c these generally run about 5-6%/realtor?

[Anonymous]

Anonymous wrote:There are many more pieces of information that we need. As mentioned, do you want $100K profit over what you bought for or walking away from the table with $100K in hand? What is your current mortgage balance (e.g. how much have you paid off)? Is your home in decent condition? Have you taken good care of it? Are the appliances in good and sellable condition or will buyers be inclined to ask for either a home warranty or to have appliances replaced? Are there hidden issues? (Plumbing, electrical, wall damage, potential mold or insect issues). All of these are likely to affect your bottom line.

Thanks. I am trying to figure out what our payoff amount/current mortgage balance is currently. I have a message into our mortgage company to figure this out. Stupid company doesn't seem to answer any of their phone calls; you just have to leave your info and then they call you back. Or, they just tell you: "Check out our website!" " Well, I cannot check out the website if I cannot get thru to you to get the info I need, to register on your blessed website."

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:OP back. We are not selling anytime soon. We will pretty much decide to sell when we can clear the amount we need. (Not necessarily $100, but I was picking that as an easy round # to work with.) Does this help elucidate my question a bit more? Sorry my first query was not written clearly in this aspect

No, not really. You're not expressing yourself very well. PP's question was a good one -- do you want to walk away from the table with $100,000 or do you want to earn a $100,000 profit? (or whatever figure you have in mind...).

Assuming it's profit, you'd need to sell it for about $485,000 (which is $355,000 plus $100,000 plus about $30,000 for commissions and other closing costs.)

Thanks so much. We would like to walk away from the table with $100,000 (or whatever figure we have in mind). So we would need to sell it for more than $485,000, which is $355,000 plus $100, plus about $30,000 for commissions and other closing costs, b/c these generally run about 5-6%/realtor?

Well, not necessarily. Say you only owe $300,000. If you only want have $100,000 in your pocket after closing you're looking at a sale price of $430,000 ($400,000 plus $24,000 commission, plus other closing costs). But your profit in that case is much less than $100,000.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:OP back. We are not selling anytime soon. We will pretty much decide to sell when we can clear the amount we need. (Not necessarily $100, but I was picking that as an easy round # to work with.) Does this help elucidate my question a bit more? Sorry my first query was not written clearly in this aspect

No, not really. You're not expressing yourself very well. PP's question was a good one -- do you want to walk away from the table with $100,000 or do you want to earn a $100,000 profit? (or whatever figure you have in mind...).

Assuming it's profit, you'd need to sell it for about $485,000 (which is $355,000 plus $100,000 plus about $30,000 for commissions and other closing costs.)

Thanks so much. We would like to walk away from the table with $100,000 (or whatever figure we have in mind). So we would need to sell it for more than $485,000, which is $355,000 plus $100, plus about $30,000 for commissions and other closing costs, b/c these generally run about 5-6%/realtor?

Well, not necessarily. Say you only owe $300,000. If you only want have $100,000 in your pocket after closing you're looking at a sale price of $430,000 ($400,000 plus $24,000 commission, plus other closing costs). But your profit in that case is much less than $100,000.

OH I see what you mean! Thank you! So I really really need to get what that mortgage balance is. B/c since we'd like to walk away with $100,000 in our pocket (and not necessarily $100 profit), that seems to be the lynch-pin.

[Anonymous]

Anonymous wrote:

OH I see what you mean! Thank you! So I really really need to get what that mortgage balance is. B/c since we'd like to walk away with $100,000 in our pocket (and not necessarily $100 profit), that seems to be the lynch-pin.

13:43 again. Okay, you've got the basics there. But a few more tips (which you may or may not know). First, the payoff amount of a loan is going to be higher than just the outstanding balance. The original amount and interest payments were designed to prorate across 15 or 30 years and when you pay off, they still get to compound interest for the last month based on a payoff. So, you need to plan for some additional interest, plus some loan management fees that will be factored into your final payment. The amount of interest depends on your interest rate, the number of days that they get to charge interest (the interest is higher if you pay later in the month vs earlier in the month). You need to ask your bank to computer what your payoff amount would be at any given time to give you an idea of how much over the amount of your mortgage balance to plan for to cover those fees. I also am really serious that you need to do a serious evaluation of your home and property to determine what things are in usable/good condition and what things will need to be replaced. Think of yourself as a buyer and imagine whether you'd want to buy a new home and worry about appliance or poor DIY repair in a closet, or an unfinished room that needs to be finished, etc. You should build in about 1-2% of the home price for repairs, items that will need to be addresses before selling and to have a buffer for seller concessions that the buyer may (and probably will) ask for. If you're willing to spend that $-4-8K out of pocket and not include it in the $100K in pocket, fine, but most people include that in their profit margin so take it into account.

[Anonymous]

Thank you so much. You are right: I only had/have tahe basics so I definitely appreciate the fleshed-out info in your previous post. Thank you so very much.

Ok, so I just got the principal balance finally from our mortgage company, and that is $322,420 and some change. The lady was sure to stress that this was not the exact payoff amount, bc that would require us to email a request and then we'd get it a reply in 2 days taking into account interest, etc., but that it was a good ballpark estimate.

So, given that info, if we owe roughly $320K, to get $100K in our pocket after closoing we'd have to sell at $420K, but then we also have to add in commission and other closing costs, so we'd have to sell at about. . .. $460K???

And, like you said, we'd have to also factor in at whatever we may have to do in repairs or give to buyer for concessions.

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But, the more we pay down our mortgage now, before we sell (which could be in a few more years), the less we'd have to sell it for, in order to walk away with $100K in our pocket, b/c we'd owe less on our mortgage.