How to Use the Home Sale Proceeds Calculator
- Enter the price you expect to sell for.
- Choose one commission rate or a tiered commission.
- Enter the tax on commission and your mortgage balance.
- Add the prepayment penalty, legal fees and other selling costs.
- Read your net proceeds, total selling costs and equity.
Enter the price you expect to sell for, then your agent's commission. Choose one percentage for a simple listing agreement, or the tiered option if the agreement charges one rate on the first part of the price and a lower rate on the rest, a structure common in some markets. Add the sales tax charged on the commission where you live, or 0 if none applies.
Next, enter the mortgage balance and any prepayment penalty from your lender's payout statement, your legal or closing fees, and other costs such as staging, repairs, moving and utility adjustments. If you will receive money back at closing, such as property tax you prepaid, add it as a credit. The result is your estimated net proceeds, the cash left after everything is paid.
Net Proceeds Formula
selling costs = commission + tax on commission + penalty + legal fees + other costs
net proceeds = sale price − selling costs − mortgage balance + credits
The mortgage balance is not a cost of selling, but it must be repaid from the sale, so it comes off the proceeds. The prepayment penalty is a cost: lenders often charge one when a closed mortgage is paid off before its term ends. Our mortgage penalty calculator can estimate it, but the lender's payout statement is the figure to trust.
Equity before selling costs is simply the price minus the mortgage balance, which shows how much of the price is yours before fees.
Worked Example
You sell for $750,000 with a 5% commission, which is $37,500, plus 13% tax on the commission, $4,875. Your lender charges a $6,500 prepayment penalty, legal fees are $1,500 and other costs come to $4,000. Total selling costs are $54,375, or 7.25% of the price. After paying off the $380,000 mortgage, you keep $315,625.
With a tiered commission of 7% on the first $100,000 and 2.5% on the rest, the commission falls to $23,250 and the tax to $3,022.50, so total costs drop to $38,272.50 and net proceeds rise to $331,727.50.
| Item | Amount |
|---|---|
| Sale price | $750,000.00 |
| Commission at 5% | −$37,500.00 |
| Tax on commission at 13% | −$4,875.00 |
| Prepayment penalty | −$6,500.00 |
| Legal fees and other costs | −$5,500.00 |
| Mortgage payout | −$380,000.00 |
| Net proceeds | $315,625.00 |
If you are buying another home at the same time, net proceeds usually become the down payment on the next purchase. The money arrives only on the closing date, after the lender and lawyer have been paid, so plan the timing of both closings carefully, or arrange bridge financing if the purchase closes first.
Tips to Keep More From Your Sale
- Ask your lender for a payout statement early. Penalties can be large, and some mortgages can be ported to a new home instead.
- Read the listing agreement for how commission is calculated and whether tax is added on top.
- Time the sale around your mortgage term. Selling close to renewal may avoid a penalty.
- Get quotes for legal fees and moving before you list, so the estimate uses real numbers.
- Keep a cushion. Closing adjustments for taxes, utilities and condo fees can move the final figure in either direction.
Assumptions and Limits
The calculator does not include capital gains tax, which may apply to a property that is not your principal residence, or any transfer taxes the seller pays where you live. Commission and tax rules differ by province, state and country, so use the figures from your own agreement. Amounts work in any currency. This is an estimate, not legal or tax advice; your lawyer or closing agent will prepare the final statement of adjustments.
Frequently asked questions
How do I calculate net proceeds from selling my home?
Start with the sale price, subtract the agent commission and any tax on it, legal fees, the mortgage balance, any prepayment penalty and other selling costs, then add credits you receive at closing.
What costs come off the sale price of a house?
Typical costs are the agent commission, tax on the commission where it applies, legal or closing fees, a mortgage prepayment penalty, and preparation and moving costs. The mortgage balance is also repaid from the proceeds.
How is a tiered real estate commission calculated?
One rate applies to the first part of the price and a second rate to the rest. For example, 7% on the first $100,000 and 2.5% on the remaining $650,000 of a $750,000 sale is $23,250.
Will I pay a penalty for paying off my mortgage when I sell?
If you break a closed mortgage before its term ends, your lender may charge a prepayment penalty. Ask for a payout statement, and check whether you can port the mortgage instead.
Is tax charged on real estate commission?
In some places, yes. For example, GST or HST is charged on real estate commissions in Canada. Enter the rate that applies to you, or 0 if commission is not taxed where you sell.
Does this include capital gains tax?
No. The sale of a principal residence is often exempt, but rental or second properties may be taxable. Check the rules where you live or ask a tax professional.