when and how do you get paid when you sell your house

Home Selling

When and how do you get paid when you sell a house?

September 28, 2018 | by Andrew Schmeerbauch

when and how do you get paid when you sell your house

Congratulations! You have officially sold your home (if not we can help!). Now that the closing process is over, you might be wondering how do you get paid when you sell a house.

It can be especially handy to know where the money will come from and when it will arrive if you are in the process of closing on another home.

This is because you might need the money from the first sale to produce a down payment for your new home or to secure the best financing on your next mortgage. Perhaps you would even like to pay for your new property in all cash, if possible.

Whatever you choose, we have the answers for you.

Here is everything you need to know about what the process will be like after closing:

Equity: What It Means for Your Payday

In order to receive money from the sale of your home, you need to have equity in your home. Equity in legal terms is the difference between the value of the assets and the value of the liabilities of something owned.

In plain English: equity is the amount of the mortgage you have paid off.

So, let’s say you bought a $100,000 house with a $20,000 down payment. At the beginning of your time as a homeowner, you will have 20% equity in your house because you own 20% worth.

When you would like to sell your house, let’s say you have paid $50,000 into it. So you have 50% equity in your home.

For the sake of this example, let’s also say the value of your home has not increased for the duration of your ownership. So, when it comes time to sell it for $100,000, you will only receive $50,000 and your lender will receive the other half. This is because you only legally owned 50% of the property.

Who Pays You after You Sell Your House?

This is probably the most common question about the property transfer process.

When you sell your home, your buyer’s lender pays you based on the amount of equity you have in your home.

Using the previous example of a $100,000 home with 50% equity, you will receive $50,000 from the sale.

The seller’s lender would then transfer the remaining $50,000 to your original mortgage lender. Because you had yet to earn that bit of equity, 50% of your home still belonged to the lender.


How Do You Get Paid when You Sell a House?

There are two options to choose from when you determine how to get paid when you sell a house. You can request a physical paper check OR you can have the funds wired directly into your bank account.

Neither option is technically better than the other. It all depends on personal preference and how soon after the closing proceedings that you would prefer to receive the money owed to you.

How Soon after Closing Will You Get Paid?

It depends on the lenders involved and how you choose to receive your money. Sometimes, you can walk away from the closing table with a check in your hand for the entire balance of the sale.

Sometimes it can take a lender up to 10 business days to process and release your funds this way.

If you choose a wire transfer, it is usually an immediate way to receive your money. However, some lenders require at least 24 to 48 hours to confirm.

Talk to Your Realtor

To know when you will receive your funds, work with your Realtor to check in with your lender. Ask them about their turn time, which is the amount of time it will take them to balance a file and issue funds.

Another helpful thing to know is where you are in line. That is, how many other people’s accounts do they need to check and balance before they get to yours. For reasons like this, it is best not to schedule your closing late on a Friday afternoon.

Other Costs to Consider

There are a few other costs to consider when you wonder how to get paid when you sell a house

Realtor’s Commission

When you sell a home, you are also responsible for paying your Realtor’s commission. This is typically about 6% of your home’s sale price, but it can be more, depending on what kind of agent you use.

There are also flat fee real estate options available, which can significantly increase the amount of money you get to keep in your pocket after a home sale.

Closing Costs

As the seller of a home, it’s also important to keep in mind that you could be responsible for certain closing costs, like inspection fees and last minute house repairs. Things like this can significantly eat into your “profit,” especially if you have low equity in your home.


Let’s say you have 100% equity in your home or stand to make a profit from its sale in any way. There are typically tax implications for this.

Generally, you can exclude up to $500,000 if you are married, filing jointly in profit from a home sale. This is only true if you have lived in your house for two of the last five years.

Sometimes if you have lived in a home for less than two years, you can file a tax exclusion if you are moving due to health reasons or a change in employment.

Have a lawyer look over your home’s contract of sale to make sure that everything is fair. You also want them to make sure there is nothing hidden inside that could get you into any trouble.

Want to sell your home for one flat fee – putting more money in your pocket? Use Clever. Our professional agents will take the stress out of selling your home for a great flat-rate. Call us today at   1-833-2-CLEVER or fill out our online form to get started.

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