Question

A seller wants to sell her existing house and owes $290,000 on mortgage. At closing of the sale she will pay $1,400 in closing costs, plus a 6% brokerage fee. She wants to realize at least $55,000 for a down payment for the purchase price of a new house. What is the minimum amount she must sell her house for to net $55,000?

Answer 1

Answer:

$ 363,880

Explanation:

The seller must cover the mortgage, closing costs, and brokerage fee. Once these expenses are covered, the down payment is added. This adds the minimum amount for the house price.

Mortgage      290,000  

Closing costs            1,400

Brokerage fee        17,400 (6% * 290,000)

Total Expenses 308,800

Down payment         55,000

Minimun price    363,880