Seller Closing Cost and Net Proceeds Guide: Every Cost So There Are No Surprises

Look, here’s what nobody wants to talk about in real estate: that exciting sale price you’re celebrating? It’s not what you’re taking to the bank. Not even close.

And if you’re in Ellis County or anywhere across North Texas right now, understanding this gap between your sale price and your actual net proceeds isn’t just important, it’s absolutely critical to making smart decisions about your next move.

I’ve watched too many sellers get blindsided at closing. They see that big number on the contract and start planning their next chapter, only to realize they’re walking away with 30-40% less than they expected. That’s not just disappointing, it’s financially dangerous if you’ve already committed to your next property.

So let’s pull back the curtain. Let’s talk about every single dollar that’s going to come out of your proceeds, why it’s coming out, and most importantly, how to keep as much of it in your pocket as possible.

The Brutal Truth About Seller Closing Costs

Here’s your wake-up call: in Texas, you’re looking at seller closing costs ranging from 3.51% to 6% of your home’s sale price, and that’s before we even talk about real estate commissions. [1]

Let’s make this real. Take a median North Texas home at $348,400. You’re immediately looking at somewhere between $12,229 and $20,904 in closing costs alone. Add in commissions at roughly 5.76%, and you’re watching another $20,068 disappear.

That’s over $40,000 in costs before you’ve paid off your mortgage or covered a single repair credit.

Now, before you panic and decide not to sell, understand that knowledge is power here. When you know exactly what’s coming, you can plan for it, negotiate around it, and strategically minimize it.

Sale Price vs. Net Proceeds: The Gap That Matters

This is where most sellers get confused, so let me break it down crystal clear:

Sale Price = What the buyer agrees to pay for your house

Gross Proceeds = The total money coming in before any deductions

Net Proceeds = What you actually receive after everything is paid, your mortgage, commissions, closing costs, repairs, concessions, the whole deal [2]

Here’s a real-world North Texas example:

Sale Price: $400,000

• Mortgage Payoff: -$200,000
• Real Estate Commissions (5.76%): -$23,040
• Closing Costs (3.5%): -$14,000
• Seller Concessions: -$5,000
• Repair Credits: -$2,000
• Prorated Property Taxes: -$1,500
• HOA Transfer Fees: -$250
• Moving Costs: -$1,500

Your Actual Net Proceeds: $152,710

That’s 38% of your sale price. You sold for $400,000, but you’re netting $152,710.

This isn’t me trying to discourage you, this is me making sure you’re not surprised when reality hits at the closing table.

Every Single Cost You’re Going to Face (And How to Handle It)

1. Real Estate Commissions: Your Biggest Expense

Let’s talk about the elephant in the room. Real estate commissions have historically run between 5.76% and 5.85% of your sale price in our market.

Thanks to the recent NAR settlement, there’s more flexibility now, particularly with buyer’s agent compensation. But here’s what I’m seeing on the ground: most sellers are still offering buyer agent commission because properties that don’t? They’re sitting longer and selling for less.

The market has spoken. Buyers expect their agent to be compensated, and when you don’t offer it, you’re limiting your buyer pool. That’s not strategy, that’s sabotage.

The Franklin Move: Instead of fighting commission structure, leverage it. Price strategically, create competition among buyers, and negotiate from strength. When you have multiple offers, suddenly those commissions don’t sting as much because your sale price just went up $15,000.

2. Owner’s Title Insurance: Your Non-Negotiable Protection

In Texas, sellers customarily pay for the owner’s title insurance policy. This runs 0.6% to 0.9% of your sale price and is regulated by the Texas Department of Insurance. [3]

On that $400,000 home, you’re looking at $2,400 to $3,600.

This isn’t optional, and honestly? You shouldn’t want it to be. This policy protects the buyer (and you) from title defects, liens, or ownership disputes that could surface after closing. It’s insurance against getting sued because of something that happened before you even owned the property. [4]

3. Prorated Property Taxes: Your Fair Share of the Year

Texas property taxes are paid in arrears, which means you’re always paying for last year’s taxes. At closing, you’ll pay your proportional share for the time you owned the property during the current tax year. [5]

Here’s the calculation: Your annual property tax bill ÷ 365 days × number of days you owned the property in the closing year.

Example: $6,000 annual tax bill, and you owned the property for 250 days of the year = $4,109.59 that you’ll owe at closing.

Strategic Timing: This is why closing earlier in the year can sometimes save you money, you’re responsible for fewer days of taxes. It’s not always possible, but it’s worth considering if you have flexibility.

4. Recording Fees: The Administrative Costs

These vary by county but typically run $21-25 for the first page of a document and about $4 for each additional page. Total recording fees usually land around $750 per transaction.

In Ellis County, these fees are standardized, so there’s not much room to negotiate here. Just factor them in. [See the full breakdown by county in NTX]

5. Transfer Taxes: Texas’s Gift to Sellers

Here’s some good news: Texas doesn’t charge a state real estate transfer tax.

Some states hit you with 1-2% of the sale price just for the privilege of transferring property. Texas doesn’t. This is one area where selling in our state actually saves you thousands compared to other markets. [6]

6. Title and Escrow Fees: The Transaction Facilitators

Escrow or settlement fees typically run $200-600, plus you’ll pay for deed preparation, notary fees, courier fees, and document recording.

These are the costs of actually processing the transaction, getting all the paperwork properly executed, notarized, recorded, and filed with the county.

Total impact: Usually $800-1,200 all in.

7. Seller Concessions: The Negotiable Wild Card

Seller concessions are closing costs you agree to pay on behalf of the buyer. This is becoming increasingly common in our market, particularly with first-time buyers who are cash-strapped.

Typical concessions run around 2% of the sale price, though maximum allowable amounts vary based on the buyer’s loan type:

• Conventional loans: Up to 3-9% depending on down payment
• FHA loans: Up to 6%
• VA loans: Up to 4%
• USDA loans: Up to 6%

Here’s the strategic play: Instead of just agreeing to concessions, build them into your pricing strategy. If you know buyers are going to ask for 2% in concessions, price your home to absorb that cost while still netting what you need.

8. Home Warranty: Your Optional Buyer Incentive

A home warranty typically costs sellers $500-650 and covers major systems and appliances for the buyer’s first year of ownership.

Is it required? No.

Can it help your home sell faster and for more money? Absolutely.

In a competitive market, this is often unnecessary. In a slower market, it’s a small investment that can differentiate your property and give buyers peace of mind.

9. HOA Fees and Special Assessments: Community Obligations

If you live in a neighborhood with an HOA, you’ll need to:

• Pay any outstanding dues up to closing
• Cover HOA document preparation fees (usually $200-400)
• Pay any special assessments that were voted on during your ownership
• Provide current HOA financials and governing documents to the buyer

Critical Warning: Unpaid HOA dues can become liens on your property and prevent closing. Handle these before listing, not when you’re under contract. [7]

10. Attorney Fees: Optional But Sometimes Valuable

Texas doesn’t require attorney representation in real estate transactions, but some sellers choose to involve one, particularly for:

• Complex property ownership situations
• Estate sales
• Out-of-state sellers
• Properties with title issues or liens

Expect to pay $150-400 per hour if you go this route.

11. Mortgage Payoff and Prepayment Penalties: Your Biggest Deduction

Your outstanding mortgage balance is typically your largest closing cost. This includes:

• The remaining principal balance
• Interest accrued up to the closing date
• Any prepayment penalties (rare but check your loan documents)

Important: If you’ve recently refinanced or have a loan with a prepayment penalty clause, that penalty could cost you thousands. Review your mortgage documents early in the process.

12. Repairs and Inspection-Related Costs: The Negotiation Factor

After the buyer’s home inspection, you’ll likely face one of three scenarios:

1. The buyer requests specific repairs (you pay contractors directly)
2. The buyer requests repair credits (money off the purchase price)
3. The buyer requests closing cost assistance instead of repairs

In North Texas, typical inspection-related costs run $500-5,000 depending on the home’s age and condition. [8]

The Franklin Approach: Get ahead of this. Do your own pre-listing inspection, address major issues upfront, and price the property to account for known defects. When you control the narrative, you control the negotiation.

How to Calculate Your Actual Net Proceeds

Here’s the formula you need to memorize:

Sale Price
- Outstanding Mortgage Balance  
- Real Estate Commissions (typically 5.76%)
- Closing Costs (3.5% of sale price)
- Seller Concessions (if negotiated)
- Repair Credits or Inspection Items
- Prorated Property Taxes
- HOA Fees/Assessments
- Moving and Staging Costs
= YOUR NET PROCEEDS

Do this exercise right now with your actual numbers. Don’t wait until you’re under contract to figure out if you can afford to sell.

Understanding Your Seller’s Net Sheet

Your real estate agent should provide you with a detailed net sheet before you list. This document estimates your net proceeds based on different sale price scenarios.

Here’s what it should include:

• Estimated sale price (usually showing multiple price points)
• All anticipated costs itemized
• Your mortgage payoff amount
• Estimated net proceeds for each scenario

Critical Point: This is an estimate, not a guarantee. Your actual net proceeds will vary based on the final negotiated sale price, inspection results, closing date (which affects prorated taxes), and other variables.

Get this updated every time circumstances change, when you receive an offer, when inspection negotiations conclude, and before final closing.

How to Maximize Your Net Proceeds (The Strategic Playbook)

1. Price It Right From Day One

Overpricing doesn’t protect your net proceeds, it destroys them.

Every day your home sits on the market, it’s costing you money in:

• Continued mortgage payments
• Property taxes and insurance
• Utilities and maintenance
• Lost opportunity cost
• Market perception damage (becoming “that stale listing”)

The data is brutal: Homes that sell in the first 30 days sell for an average of 1.5-2% more than homes that sit for 60+ days.

Price it right initially, create competition among buyers, and you’ll net more money even if the sale price is slightly lower than your wishful thinking number.

2. Strategically Negotiate Buyer’s Agent Compensation

Post-NAR settlement, you have more flexibility here. But let me be direct: offering zero buyer agent commission in today’s market is like putting a “Don’t Show This House” sign in your yard.

The smarter play: Offer competitive compensation but build it into your pricing strategy. In a strong market with multiple offers, you might even negotiate it down after offers come in.

3. Time Your Closing Strategically

Closing earlier in the year means you’re responsible for fewer days of property taxes. If you have the flexibility, this can save you $500-1,500.

Also consider: Closing at the end of the month means you owe less interest on your existing mortgage for that month.

4. Minimize Concessions Through Strategic Positioning

The best way to avoid paying buyer closing costs? Create multiple offers.

When buyers are competing:

• They’re less likely to ask for concessions
• They’re more motivated to waive inspection issues
• They’re willing to pay more

You create competition through:

• Aggressive pricing
• Outstanding presentation
• Strategic timing (list when inventory is low)
• Generating urgency through well-executed marketing

5. Don’t Over-Improve, But Don’t Neglect Critical Issues

Here’s the mistake I see constantly: sellers either:

• Spend $30,000 on renovations hoping to get $50,000 back (you won’t), or
• Do nothing and then get hammered in inspection negotiations

The winning strategy: Focus on maintenance and repairs that buyers will discover during inspection. Fix the roof leak, address the HVAC issue, repair that foundation crack.

Skip the kitchen remodel, the luxury flooring, and the pool you think everyone wants.

6. Understand Capital Gains Tax Implications

If you’ve lived in your home as your primary residence for at least 2 of the last 5 years, you can exclude:

• $250,000 of profit if you’re single
• $500,000 of profit if you’re married filing jointly

This is profit (sale price minus purchase price and capital improvements), not just proceeds.

Texas Advantage: We have no state capital gains tax. Some states will tax your gains at 5-13%—but not Texas.

Calculate your potential capital gains early. If you’re approaching the exclusion limits, timing your sale strategically could save you tens of thousands in federal taxes.

Common Seller Questions (Answered Honestly)

“What Percentage of My Sale Price Will I Actually Keep?”

After paying off your mortgage and all costs, most North Texas sellers net between 85-92% of their sale price. [9]

But that’s heavily dependent on how much you still owe on your mortgage. If you’ve owned the property for 20 years and have significant equity, your net percentage will be much higher. If you bought two years ago and have minimal equity, it’ll be lower.

“Who Pays Closing Costs in Texas: Buyer or Seller?”

Both. But sellers typically pay:

• Real estate commissions for both agents
• Owner’s title insurance policy
• Prorated property taxes through closing
• Recording fees
• HOA transfer fees
• Any negotiated seller concessions

Buyers typically pay:

• Loan origination fees
• Lender’s title insurance policy
• Appraisal and inspection costs
• Prepaid expenses (taxes, insurance, interest)

“When Will I Actually Get My Money?”

Typically within 24-48 hours after closing. The title company will either wire the funds directly to your bank account or provide a cashier’s check.

Pro tip: Set up the wire transfer in advance. It’s faster, more secure, and you don’t have to worry about a check getting lost or delayed.

“Are Any Closing Costs Tax Deductible?”

Unfortunately, most seller closing costs are not directly tax deductible in the year of sale.

However, they can reduce your capital gains calculation, which reduces your tax liability if you exceed the capital gains exclusion limits.

Always consult with a CPA or tax professional about your specific situation. This isn’t tax advice: it’s a suggestion to get actual tax advice.

“What If I Owe More Than My House Is Worth?”

This is called being “underwater” or “upside down” on your mortgage. Your options:

1. Short Sale: Negotiate with your lender to accept less than you owe
2. Bring Cash to Closing: Pay the difference between sale price and mortgage balance
3. Wait and Build Equity: Continue paying down the mortgage while home values (hopefully) appreciate
4. Loan Modification: Work with your lender to restructure your loan

None of these options are great, which is why understanding your equity position before listing is critical. [10]

North Texas Market Factors That Affect Your Net Proceeds

Current Market Conditions

As of late 2025, the North Texas market is showing:

• Median home prices around $348,400
• Relatively balanced market conditions (slight seller advantage in some submarkets)
• Days on market averaging 30-45 days for properly priced homes
• Interest rates affecting buyer purchasing power

What this means for you: Price aggressively, market strategically, and don’t assume the seller’s market of 2020-2022 is coming back anytime soon.

Ellis County and Waxahachie Specific Considerations

In our market specifically:

• Property taxes are higher than some surrounding counties (factor this into your prorated costs)
• New construction competition is fierce (price accordingly)
• Buyer expectations are elevated (presentation matters more than ever)
• Migration from higher-cost areas means cash buyers are more common

The Ferris Development Impact

That 5,200-acre development in Ferris? It’s going to affect seller proceeds in surrounding areas over the next 2-3 years.

How: As new inventory comes online, you’re competing with brand-new construction. This doesn’t mean you can’t sell—it means you need to position strategically based on your home’s condition, location, and price point.

Legal Compliance: What You Must Know

Fair Housing Act

You must treat all potential buyers equally regardless of race, color, religion, sex, national origin, familial status, or disability.

This isn’t just about being a good person, it’s federal law. Violate it, and you’re opening yourself to serious legal liability. [11]

RESPA (Real Estate Settlement Procedures Act)

You must receive a Closing Disclosure with all itemized costs at least 3 business days before closing.

Review this document carefully. If anything doesn’t match your expectations or previous estimates, ask questions immediately, not the day of closing. [12]

NAR Code of Ethics

All advertising must be accurate and honest. Any material defects must be fully disclosed. This isn’t optional. [13]

TREC Advertising Rules

In Texas, all real estate advertising must include the broker’s name prominently. This protects consumers by ensuring they know who they’re working with. [14]

Costly Mistakes to Avoid

1. Choosing the Agent Who Quotes the Highest Price

The agent who promises the highest sale price is often the one who will disappoint you most.

Why: They’re buying your listing with an inflated number, planning to reduce the price later after you’ve committed to them and your home has been sitting on the market.

Choose the agent with proven recent sales results, a solid marketing plan, and honest pricing guidance—not the one telling you what you want to hear.

2. Being Present During Showings

Get out. Every time. No exceptions.

Buyers cannot emotionally connect with a home when the seller is hovering, watching, or “just staying out of the way in the bedroom.”

You make them uncomfortable, they rush through, they don’t fall in love, and they move to the next house.

3. Neglecting Cleaning, Staging, and Presentation

First impressions aren’t just important—they’re decisive.

Buyers form an opinion about your home within 7-10 seconds of walking in the door. If that opinion is “dirty” or “cluttered” or “outdated,” you’re already negotiating from weakness.

4. Failing to Disclose Known Issues

This is illegal in Texas. If you know about a material defect and don’t disclose it, you’re opening yourself to lawsuits that will cost far more than just addressing the issue honestly upfront.

Material defects include:

• Foundation issues
• Roof problems
• HVAC system failures
• Plumbing or electrical issues
• Previous flooding or water damage
• Structural problems

When in doubt, disclose. Better to lose a sale than face a lawsuit.

Your Next Steps

1. Get a Professional Market Analysis

Contact a qualified local agent (preferably me, but I’m biased) to provide a comprehensive market analysis and detailed net sheet based on your actual property and current market conditions.

2. Prepare Your Home Strategically

Address necessary repairs, deep clean, declutter, and stage appropriately for your price point.

3. Interview Multiple Real Estate Professionals

Don’t just hire your cousin’s friend who got their license last year. Interview experienced agents and evaluate based on:

• Recent sales results in your specific area
• Detailed marketing plan
• Honest pricing guidance (not the highest number)
• Commission structure and services provided
• Communication style and availability

4. Review All Documents Carefully

When offers come in, when inspection negotiations happen, and especially before closing—read everything. Ask questions. Understand what you’re signing.

The Bottom Line

Selling your North Texas home isn’t just about listing it and waiting for offers. It’s a strategic business transaction that requires planning, positioning, and understanding every dollar that’s going to come out of your proceeds.

The difference between a seller who understands these costs and plans accordingly versus one who doesn’t? Often tens of thousands of dollars in net proceeds.

You’ve got one shot to sell this property right now, in this market, under these conditions. Make it count.

Want to know exactly what you’ll net from your specific property in today’s market? Let’s run the numbers together, no obligation, just real information that helps you make the right decision.

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📈 Get market moves before they hit the news
🎯 Text 214-228-0003 | Link in bio

Bobby Franklin – REALTOR®
Legacy Realty Group – Leslie Majors Team

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This guide reflects current Texas real estate law, NAR regulations, and TREC rules as of November 2025. Content is original and tailored specifically to North Texas sellers. Individual results will vary based on specific property conditions, market timing, and negotiation outcomes.