83. A property listed for $435,000 sold for 80% of the listed price. The seller had a mortgage balance of $189,254 on the first mortgage and a balance of $8,542 on a home equity loan. The seller also paid 5% commission and $6,800 in closing costs. What was the seller's net at closing
Answer: A
The seller's net at closing was $128,004.
To determine the seller's net at closing, we first calculate the sale price of the property at 80% of the listed price, which amounts to $348,000. After deducting the mortgage balances, commission, and closing costs, the final amount the seller receives is $128,004.
A) $128,004
This option is correct because it accurately reflects the seller's net proceeds after considering all deductions. The sale price of $348,000, minus the total mortgage balances ($197,796), minus the commission ($17,400), and closing costs ($6,800), yields a net of $128,004.
B) $141,346
This option is incorrect as it does not account for the full deductions from the sale price. If we consider the commission and closing costs without calculating the total mortgage balances properly, it leads to an inflated net amount that does not represent the seller's actual proceeds.
C) $215,454
This option is incorrect because it overestimates the seller's net by failing to deduct the total mortgage balances and other expenses adequately. The calculation must include all deductions, which this option neglects, leading to an unrealistic net figure.
D) $330,600
This option is incorrect as it suggests a net amount that exceeds the total sale price. Since the seller must pay off the mortgage and other expenses, a net of $330,600 is impossible given the financial obligations that must be settled at closing.
Conclusion
The correct answer, $128,004, is derived from a comprehensive calculation that considers all necessary deductions from the sale. All other options fail because they either miscalculate the net proceeds or overlook critical deductions that directly affect the seller's final amount at closing.