One of the most common questions homeowners ask is: “How much is my house worth?”
But when they’re actually getting ready to sell, the question usually changes to: “How much money will I actually get after everything is paid?”
That’s the number that really matters.
After all, the sale price is what the buyer pays. It’s not what ends up in your bank account.
Let’s look at a simple example.
Suppose your home sells for $800,000. If you still owe $400,000 on your mortgage, the title company will first pay off that loan at closing. That immediately leaves $400,000 before any other selling expenses are deducted.
From there, several costs are typically paid out of the seller’s proceeds.
Real Estate Commission
For most sellers, commission is the largest transaction cost. The amount depends on the brokerage and service model you choose.
Using an $800,000 sale price:
5% commission = $40,000
4% commission = $32,000
3% commission = $24,000
That’s a difference of $16,000 between a 5% and 3% commission structure.
Not surprisingly, more sellers today are comparing commission models instead of assuming every agent should charge the same amount.
Title Fees Aren’t Usually as Scary as They Look
The title company handles the closing, title insurance, escrow funds, and transfer of ownership. Many sellers see the settlement statement for the first time and feel overwhelmed by all the line items.
In Illinois, title costs tend to be somewhat higher and can easily reach several thousand dollars on more expensive homes.
In Northwest Indiana, however, title and closing fees are often much lower. For many residential transactions, they may only amount to a few hundred to a couple thousand dollars.
Compared to the mortgage payoff and commission, they’re usually not the biggest concern.
Attorney Fees
Illinois and Indiana handle real estate closings differently.
In Illinois, attorneys are commonly involved in residential transactions. Legal fees often range from a few hundred dollars to over $1,000, depending on the complexity of the transaction.
In Indiana, attorney involvement is generally not required for a typical residential sale, which often reduces closing costs and simplifies the process.
Many Illinois homeowners notice this difference immediately when they buy or sell in Indiana for the first time.
HOA Fees Can Surprise Sellers
If your property is part of a homeowners association, don’t forget about HOA-related charges.
These may include HOA document preparation fees, transfer fees, resale package fees. In some communities, these costs are relatively minor. In others, they can reach hundreds or even thousands of dollars.
And if the HOA has approved a special assessment, the seller may be required to pay the remaining balance at closing. I’ve seen special assessments ranging from a few thousand dollars to well over $20,000.
Many sellers don’t discover these charges until they review the final closing statement.
Utility and Proration Adjustments
At closing, sellers are also responsible for their share of various expenses through the date of transfer.
These may include water bills, trash service, HOA dues, property management fees, and other prorated expenses
Individually, these items are usually not large, but together they can add up to several hundred or even a few thousand dollars.
Transfer Taxes: Illinois vs Indiana
One expense that surprises many Illinois homeowners is transfer tax. Using an $800,000 sale price as an example:
Chicago: Chicago transfer tax on the seller side is approximately 0.30% of the sale price. For an $800,000 home, that’s about $2,400
Evanston: Evanston currently charges a real estate transfer tax of $5 per $1,000 of sale price. For an $800,000 home, that’s approximately **$4,000. **In most transactions, this cost is paid by the seller.
Northwest Indiana: In communities such as Munster, Dyer, Schererville, and Highland, sellers generally do not pay a local real estate transfer tax comparable to Chicago or Evanston.
For homeowners relocating from Illinois to Indiana, this difference alone can save several thousand dollars.
The Biggest Number Is Still the Sale Price
Ironically, many sellers spend a lot of time worrying about title fees, attorney fees, and transfer taxes.
Those costs matter. But most of them are relatively fixed and predictable.
The number that usually has the greatest impact on your bottom line is the final sale price.
Over the years, I’ve seen homeowners spend weeks comparing small closing costs, only to lose tens of thousands of dollars because of poor pricing strategy, weak marketing, or ineffective negotiations.
A few hundred dollars here and there matters. A $20,000 pricing mistake matters a lot more.
How Do You Estimate Your Net Proceeds?
The best way isn’t by looking at Zillow. And it isn’t by checking what your neighbor’s house sold for. The best approach is to prepare a Net Proceeds Estimate.
By factoring in your mortgage payoff, estimated sale price, commission, title fees, attorney fees, HOA charges, and transfer taxes, you can get a realistic picture of how much cash you’ll actually walk away with.
Curious what your net proceeds might look like? I’d be happy to prepare a complimentary Net Proceeds Estimate based on your current mortgage balance, property details, and today’s market conditions. Sometimes the numbers reveal more options than homeowners realize.
