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Real Estate Related Computations & Closing of Tran


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closing
the consummation of a real estate contract. also called settlement.
closing statement
an accounting of the funds received and disbursed in a real estate transaction
debit
in a closing statement, an expense, money, or charge against the seller or buyer
double-entry
an amount of money showing on the closing statement for both buyer and seller. it is an amount
good faith estimate
the lender's estimate of a borrower's settlement costs that is required by RESPA to be
HUD Form No. 1
a standard settlement form required by RESPA
interim interest
interest paid on the loan amount from the date of closing through the end of the closing
paid outside closing (POC)
items paid by the buyer or seller before closing which appear on the closing
prorating
dividing certain settlement costs between buyer and seller
settlement
the consummation of a real estate contract. also called closing.
single-entry
an item that appears as a debit or credit on either the buyer's or seller's closing statement, but
accrued items
On a closing statement, items of expense that are incurred but not yet payable, such as interest on
due diligence
A buyer's investigative process of having experts inspect the property, examine title, and review
prepaid items
On a closing statement, (1) expenses paid before they are due, such as hazard insurance or rent; (2)
prorations
Shared expenses, either prepaid or paid in arrears, that are divided equitably between buyer and
reserves deposited with lender
A portion of funds set aside to cover future payments.
settlement agent
One person who usually conducts the proceedings at a closing and calculates the division of
Settlement Statement (HUD-1)
The standard closing statement form required to be given to the borrower, lender,
soil suitability test
An engineer's test to determine the ability of the ground to absorb and drain water; used to
walk-through
The final inspection of the property by the buyer prior to closing to assure that the seller has
yield spread premium
A fee, usually expressed as a percentage of the loan amount, paid by a lender to a mortgage
prorations, to Gusela when Norman has received the deed, this transaction is called
escrow
items. These items represent
bills related to the real estate that have not been paid as of the time of the
The Real Estate Settlement Procedures Act(RESPA) applies to the activities of
lenders financing the purchase of
The details of a sales transaction are always governed by
the terms of the property executed purchase contract
At closing, the listing broker's commission generally appears as a
debit to the seller
The condition of the seller's title is generally determined from a(an)
title commitment or title insurance policy
The Real Estate Settlement Procedures Act (RESPA) provides that
the borrower must be given an estimate of the
Accrued interest on an assumed mortgage loan is entered on the closing settlement as a
debit to the seller and a
following EXCEPT
That the broker be present to receive any commission
seller pay their respective portions of property charges is called
proration
All of the following items are usually prorated between the buyer and seller at closing EXCEPT
recording charges
The Real Estate Settlement Procedures Act (RESPA) applies in a loan assumption if the
terms of the assumed loan
The principal balance on an assumed mortgage loan is entered on the closing statement as a
debit to the seller
RESPA is a federal statute administered by the
Department of Housing and Urban Development (HUD)
The closing statement involves debits and credits to the parties in the transaction. A debit a/n
charge
The Real Estate Settlement Procedures Act requires
that lenders keep no more than 2 months of escrow payments
The Real Estate Settlement Procedures Act states all of the following EXCEPT
the borrower may cancel the loan
An example of a kickback that is prohibited by RESPA is
a fee paid by a surveyor to a broker for referring a
conditions are met. RESPA does NOT say that
mortgage brokers may pay a referral fee for the mortgage laon
In a closing statement, a prepaid item is a/n
item that is prepaid by the seller
arrangements are permitted by RESPA as long as
companies make written disclosure to the consumer of their
Affidavit of Title
Written statement, made under oath, that grantor identifies himself and marital status,
Controlled Business Arrangement
One stop shopping for real estate consumers; consumer must be informed of
Credit, Debit
On closing statement, amount entered in a person's favor; either an amount that party has paid or
Escrow
Closing of transaction through third party called escrow agent; who receives funds and documents to be
Kickbacks
Prohibited unearned fees when no service has been rendered; i.e., receiving fees for making
Prepaid Item
On closing statement, items that have been paid by the seller, such as real estate taxes, for which
Proration
Expenses, either prepaid or paid in arrears, that are divided or distributed between buyer and
Uniform Settlement Statement (HUD-1)
Form required by RESPA includes all charges that will be collected at