CALCULATE THAT

Question 1

Buyer’s Adjusted Interest

Answer 1

Buyer’s Cost
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((Price * Interest)/360) * ((Total Month - Date)+1)

“How many days did the buyer NOT have the Lender’s money”

Question 2

Prorated Tax HAS NOT been paid

Answer 2

Seller’s COST

Before July 1st
31+28+31+30…

(Tax/365) * # of days from start of year

Question 3

Prorate Tax HAS been paid

Answer 3

Seller CREDIT

After July 1st
31+31+30…

(Tax/365) * # of days til end of year

Question 4

Accrued Interest

Answer 4

Seller COST
Paid Backwards

((Loan * Interest)/360) * Days from Closing

Question 5

When should you use a “Cost to Buyer” Form?

Answer 5

Prior to the Offer

At the Time of the Preparing an Offer

Prior to Closing

Question 6

When is the buyer’s first monthly payment?

Answer 6

The first of the next next month:

Closing: June 23rd
1st Payment: August 1st

OR

Closing: August 1st — only on the 1st
1st Payment: September 1st

Question 7

How do I calculate an LTV ratio?

Answer 7

$$$ Down / Sales Price

Question 8

90% LTV = __% - __% Down

Answer 8

10% - 19.99%

Question 9

80% LTV = __% Down

Answer 9

(+)20% and NO PMI

Question 10

95% LTV = __% - __% Down

Answer 10

5% - 9.99%

Question 11

How do I calculate PMI & MIP

Answer 11

Buyer Cost
Paid in full at closing.

% Loan = % of loan
95% - 2.5%
90% - 2%

Financing
95% - 1% down - 1.5% financed
90 - .5% down - 1.5% financed

Question 12

FORMULA: Monthly PMI Payments

Answer 12

Buyer Cost
(Loan Amnt * .0025) / 12 = payment

Question 13

Payment of MIP

Answer 13

Buyer Cost

1.5% Down at Closing

Question 14

FORMULA: Monthly MIP Payments

Answer 14

Buyer’s Cost

(Loan Amnt * .005) / 12 = payment

Question 15

How do I calculate Escrow Items?

Answer 15

Buyer's Cost
lizzie bday - 1
REMEMBER SEPTEMBER=4 (escrow)
August = 15
# = how many monthly payments to put away in an account.

(Tax/12) * Chart Month # = $ Due at closing

Question 16

Hazard (Homeowner’s) Insurance

Answer 16

Buyer’s Cost

(Premium / 12) * 2 = Insurance Escrow

Question 17

Who is responsible for Day of Closing

Answer 17

The Seller

Question 18

Are prorations based on a 365 or 360 year?

Answer 18

365

Question 19

Calculated Loan Amounts must be rounded …

Answer 19

DOWN to $100s

Question 20

Prorating Insurance

Answer 20

SELLER COST

‘Closing’ ‘Policy Beginning’ - 1

(Premium / 365) * # of Days

Example: Policy Begins 2/9/15 … Closing at 6/21/15

Add from 6/21/15 THROUGH 2/8/16

Question 21

Rent Proration

Answer 21

Seller Cost
(Monthly Rent / # Days in Month) * Days Owed

Closing on the Feb 9th … Pay for (9-28 =) 19 days

Question 22

Tax Transfer

Answer 22

Seller Cost
NOTE: Tax = Round up to the dollar after dividing by 100

(Sales Price / 100) * .1

Question 23

Intangible Tax

Answer 23

Seller Cost

$1.50 per $500

(Loan Amount / 500) * 1.5