88. A property sells for $150,000. The existing mortgage balance is $30,000 and the seller's closing costs are $3,500. What should the seller net if the brokerage fee is 5.5%
Answer: A
The seller should net $108,250 from the sale.
To determine the net amount the seller will receive, we calculate the total deductions from the sale price, which includes the existing mortgage balance, closing costs, and the brokerage fee. After these deductions, the seller will net $108,250.
A) $108,250
This option is correct because it accurately reflects the net proceeds from the sale after accounting for all necessary deductions. The total deductions include the existing mortgage of $30,000, closing costs of $3,500, and the brokerage fee of 5.5% on the sale price, which amounts to $8,250. Therefore, the calculation is $150,000 - $30,000 - $3,500 - $8,250 = $108,250.
B) $109,900
This option is incorrect as it does not accurately represent the net proceeds after all deductions. If the brokerage fee was miscalculated or if other costs were not accounted for, this could lead to an inflated net amount that does not match the actual calculations based on the provided figures.
C) $110,090
This option is also incorrect. Similar to option B, it likely results from a miscalculation of the seller's total deductions. The net proceeds must consider all applicable fees and balances, which is not reflected in this figure.
D) $116,500
This option is incorrect because it suggests a net amount that exceeds the total sale price after deductions. It fails to account for the existing mortgage and the brokerage fee, leading to an unrealistic net figure for the seller.
Conclusion
The correct answer, $108,250, is derived from a precise calculation of the seller's financial situation after the sale, including all relevant costs and fees. Options B, C, and D do not properly reflect the necessary deductions from the sale price, thereby confirming that they are incorrect.