How much does Jamie need to accept as the minimum offer to sell her home?

What are the expenses that Jamie needs to cover when selling her home? Jamie wants to sell her home and she must pay off her existing $97,500 mortgage and $5,000 in closing costs. Additionally, she needs to pay a 7% commission. So, what is the minimum offer she can accept in order to cover all of her expenses?

Expenses to Cover

Jamie's expenses when selling her home:

  • Existing mortgage: $97,500
  • Closing costs: $5,000
  • Commission (7% of selling price)

Minimum Offer Calculation

To determine the minimum offer Jamie must accept, we need to calculate the total expenses she needs to cover when selling her home. This includes the existing mortgage, closing costs, and the commission.

Firstly, Jamie must sum up all her existing expenses. This includes her existing mortgage of $97,500 and her closing costs of $5,000. The total sum of her expenses comes to $102,500. The commission she has to pay when selling the house is 7% of the selling price.

If we denote the minimum offer she can accept as x, then we know that:

0.93x = $102,500 (since 7% commission means Jamie will get 93% of the selling price).

To solve for x, we divide both sides of the equation by 0.93, giving us:

x = $102,500 / 0.93 = $110,215.05

Therefore, Jamie must accept an offer of at least $110,215 in order to cover all of her costs and the estate agent's commission.

← Salary and employment understanding the basics Fantastic everyday stories for english comprehension practice →

More Posts: