does agrent commission include closing cost and attoney fee?

HOME Forum General Questions does agrent commission include closing cost and attoney fee?

This topic contains 3 replies, has 2 voices, and was last updated by  Peijung Tsai 1 year, 8 months ago.

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  • #6891

    Peijung Tsai
    Participant

    As I’m working on the state review exam, the question states as below:
    The owner wants to net $40,000 upon selling the property. The commission is 7%, there will be $2,500 in closing costs, plus a $450 fee to the attorney. What does the property need to sell for to get the owner $40,000 net?

    (a) $200,555

    (b) $50,125.00

    (c) $215,716

    (d) $46,182.80; the only way I can get any number close to the selection is to include the closing fee and attorney fee into the calculation (aka (40000+2500+450)/0.93 = 46182.8. I didn’t think the real estate agent commission fee includes the closing close. Please advise.

  • #6896

    Brian Swan
    Keymaster

    Yes, (d) is correct. You must add the closing costs, attorney fee, and the commission to the $40,000

  • #6899

    Peijung Tsai
    Participant

    to be clear, your answer implies that the seller agent charges commission to the closing cost. If the closing cost is $2500, the cost to the seller is $2500*1.07 = 2650. Since the closing may vary slightly, how does the seller agent provide the accurate net calculation initially?

  • #6900

    Peijung Tsai
    Participant

    Never mind. I figure out where I screw up. Thanks for the answer

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