What is the exam-ready distinction?
| Official syllabus topic | Real Estate Calculations: Seller Proceeds, Buyer Cash, Debits, and Credits |
|---|---|
| Official PSI area | Real Estate Calculations |
| Published weight | 7% of the 100-question national portion |
| Source edition | PSI Georgia Candidate Information Bulletin dated July 1, 2026 |
The Rule
PSI publishes a weight for the complete official area, not a guaranteed count for this individual comparison. Use the source, document, actor, event, and timing stated in the question before applying a memorized definition.
Side-by-side comparison
Read across each row. The terms are deliberately compared on identical dimensions so the difference remains clear when the exam hides the vocabulary inside a scenario.
| Decision dimension | Seller net | Buyer funds needed |
|---|---|---|
| Starting point | Sale price and seller credits | Purchase price, loan, and buyer-side credits or deposits |
| Subtract | Mortgage payoff, commission, seller costs, taxes, prorations, and agreed credits | Loan proceeds, earnest money already paid, seller or lender credits, and other buyer credits |
| Add | Seller credits and amounts owed to seller | Down payment, buyer closing costs, prepaid items, and buyer debits |
| Question result | Proceeds payable to seller | Cash the buyer must bring through approved funds |
Decision rule
Georgia-specific distinction
Worked example
Scenario. A property sells for $400,000. The seller owes a $250,000 payoff, a 5 percent commission, and $6,000 in other seller costs. No other credits or debits apply.
Reason it through. Commission is $20,000. Subtract $250,000, $20,000, and $6,000 from the $400,000 sale price.
Answer. The seller net is $124,000.
Common exam traps
- Mixing buyer and seller columns
- Counting earnest money twice
- Ignoring the loan payoff in seller net
- Using a sale-price percentage for a fixed closing charge
Original practice questions with detailed explanations
These are original instructional questions mapped to the July 1, 2026 PSI outline. They are not copied from PSI or any live examination. Choose an answer before opening the explanation.
Question 1A home sells for $400,000. The seller owes a $250,000 loan payoff, a 5 percent commission on the sale price, and $6,000 in other seller costs. No other credits or debits apply. What is the seller's net?
- A. $124,000
- B. $130,000
- C. $144,000
- D. $150,000
Show answer and explanation →
Answer: A. $124,000
Seller net is the sale price minus the seller's debits. The commission is $400,000 x 0.05 = $20,000, so $400,000 - $250,000 - $20,000 - $6,000 = $124,000. Forgetting the commission gives $144,000, the most common error, and forgetting the other costs gives $130,000.
Question 2A buyer purchases a home for $300,000 with a loan of $240,000. The buyer already paid $5,000 in earnest money, owes $9,000 in closing costs, and receives a $3,000 seller credit. How much must the buyer bring to closing?
- A. $56,000
- B. $61,000
- C. $64,000
- D. $66,000
Show answer and explanation →
Answer: B. $61,000
Buyer funds equal the price plus buyer costs minus the loan, the deposit already paid, and credits: $300,000 + $9,000 - $240,000 - $5,000 - $3,000 = $61,000. Forgetting to credit the earnest money gives $66,000, and ignoring the seller credit gives $64,000. Subtracting the deposit twice gives $56,000.
Question 3Which item reduces the cash a buyer must bring to closing?
- A. The seller's mortgage payoff
- B. The buyer's prepaid homeowner's insurance
- C. Earnest money the buyer already paid
- D. The lender's origination charge
Show answer and explanation →
Answer: C. Earnest money the buyer already paid
Earnest money already deposited is a buyer credit because the buyer has already paid it toward the price. Prepaid insurance and an origination charge are buyer debits that increase the cash needed. The seller's payoff is plausible because it is a large closing figure, but it is a seller debit and does not affect the buyer's funds.
Ready to move on?
You have this distinction down when all of these are true.
- Define every compared term without using the other term as the definition.
- Rebuild the comparison table from memory.
- State the decision rule and Georgia distinction without notes.
- Solve the worked example after changing one key fact.
- Explain the rule or fact that makes each distractor wrong.
- Answer all three original questions correctly in mixed practice on a later day.
Recommended next lesson
Continue with Potential Gross Income Versus Effective Gross Income Versus NOI. Next, potential gross income versus effective gross income versus NOI brings the same subtract-in-order care to income property, where vacancy comes out before operating expenses and debt service never comes out at all.
Return to the complete exam-concept library or the Real Estate Calculations hub.