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Real Estate > Ch. 14 Computations and Title Closing > Flashcards

Ch. 14 Computations and Title Closing Flashcards

Real estate brokers and sales associates must understand closing statements and should be capable of computing the various simple arithmetic problems to be solved in arriving at the figures entered on the closing statements provided to the contracting parties. Many adults have had little or no occasion to work with fractions, decimals, percentages, and the like for years. The first section of this chapter assumes little or no prior knowledge about these subjects and their application.

1
Q

The state of being behind in the discharge of an obligation; paid at the end of the period for which due (the opposite of in advance).

A

arrears

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2
Q

As a verb, to make an entry on the right or credit side of an account; as a noun, payment or value received.

A

credit

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3
Q

As a verb, to make an entry on the left or charge side of an account; as a noun, a charge or expense.

A

debit

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4
Q

A method for amortizing a mortgage whereby the borrower pays the same amount each month.

A

level-payment plan

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5
Q

1

A

pre-closing inspection

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6
Q

The party employing the services of a real estate broker; amount of money borrowed in a mortgage loan, excluding interest and other charges.

A

principal

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7
Q

The amount one makes over and above one’s cost.

A

profit

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8
Q

prorate
To divide or assess proportionate shares of charges and credits between the buyer and the seller according to their individual period of ownership.

A

prorate

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9
Q
  1. Change the percentages to decimals.
    a. 39 1/2%
    b. 2%
    c. 75%
    d. 145%
A

a. .395
b. .02
c. .75
d. 1.45

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10
Q
  1. Change the percentages to fractions.
    a. 50%
    b. 20%
    c. 25%
    d. 40%
A

a. 1/2
b. 1/5
c. 1/4
d. 2/5

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11
Q
  1. Change the fractions to decimals.
    a. 1/8
    b. 3/5
    c. 1/16
    d. 1/20
A

a. .125
b. .6
c. .0625
d. .05

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12
Q
  1. Divide the numbers below.
    a. 44,032 ÷ 1.72
    b. 493.8 ÷ .60
    c. 18,768 ÷ 25.5
    d. 7,735 ÷ .17
A

a. 25,600
b. 823
c. 736
d. 45,500

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13
Q
  1. A senior sales associate receives 55 percent of all sale commissions earned. His broker has listed a motel for $1,450,000. The listing contract specifies a 6 1/2 percent sale commission for the first 600,000 of the selling price, 7 percent for the next $800,000, and 8 percent commission on all of the actual sale price exceeding $1.4 million. What will the sales associate’s commission be if he sells the motel for the listed sale price?
    a. $44,550
    b. $54,450
    c. $95,000
    d. $99,000
A

B

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14
Q
  1. The interest portion of a man’s first monthly payment on a 30-year, 12 percent mortgage amounts to $550. If the loan-to-value ratio for the man’s house is 80 percent, how much did he pay for the house?
    a. $44,000
    b. $55,000
    c. $68,750
    d. $110,000
A

C

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15
Q
  1. You bought a house in Citrus, Florida, for $130,000. You gave a deposit of $19,480, assumed a recorded mortgage of $90,520, and signed a new second mortgage and note for $20,000. What are the total state taxes due as a result of this transfer of property?
    a. $1,337.10
    b. $1,336.82
    c. $1,336.75
    d. $1,297.57
A

C

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16
Q
  1. A broker lists a property, a 7 percent commission is agreed to, and the listing is placed in the MLS. The sale commission is to be split as follows: 45 percent to the listing broker and 55 percent to the selling broker. A sales associate who works for a cooperating broker sells the property for $160,000. The sales associate’s agreement with her employer calls for a 60 percent share to her of all commissions she brings to the company. How much is due the sales associate?
    a. $2,016
    b. $2,464
    c. $3,024
    d. $3,696
A

D

17
Q
  1. A woman owned 3/8 of a property. She was paid $45,000 as her share of the proceeds from the sale of the property. What was the total selling price of the property?
    a. $120,000
    b. $90,000
    c. $72,000
    d. $61,875
A

A

18
Q
  1. To get a mortgage loan of $31,000, a buyer has agreed to pay all state tax costs incurred by creation of the new mortgage. What is the total cost?
    a. $62.00
    b. $108.50
    c. $170.50
    d. $217.00
A

C

19
Q
  1. You have a VA mortgage of $48,000 at 9 percent with a 30-year term. The monthly principal and interest payment is $386.21. What portion of the second month’s payment will apply to amortization of the mortgage?
    a. $26.21
    b. $26.41
    c. $359.80
    d. $360.00
A

B

20
Q
  1. In the mortgage cited in question 11, what would the monthly payments amount to if your property taxes were $840 and your annual insurance $570?
    a. $433.71
    b. $456.21
    c. $474.71
    d. $503.71
A

D

21
Q
  1. A woman bought three 200-foot lots on a lake for $500 per front foot each. She then subdivided these lots into six lakefront lots, which she then sold for $62,500 each. What was her percentage of profit on the sales?
    a. 20 percent
    b. 25 percent
    c. 75 percent
    d. 80 percent
A

B

22
Q
  1. A warehouse measures 720 feet by 500 feet and rents for $118,000 a month. What is the rent per square foot per month?
    a. $0.25
    b. $0.33
    c. $3.05
    d. $3.96
A

B

23
Q
  1. A man incurred a 20 percent loss when he sold a 10-acre parcel (Tract A) for $100,000. He also owns a 25-acre parcel (tract B) for which he paid $200,000. How much must he sell Tract B for if he wishes not only to recover his loss from Tract A but also to realize a 20 percent profit on his investment in Tract B?
    a. $260,000
    b. $265,000
    c. $270,000
    d. $275,000
A

B

24
Q
  1. A couple is purchasing an apartment building. Each of the five apartments rents for $815 per month. The closing is scheduled for September 16, and the rents were collected on September 1. What is the rent proration for this transaction and to whom will the amount be credited? (Day of closing belongs to the buyer.)
    a. $407.50, credit buyer
    b. $1,901.67, credit seller
    c. $2,037.50, credit buyer
    d. $2,173.33, credit seller
A

C

25
Q
  1. a 28.5-acre parcel of land in Orange County sells for $4,100 per acre. What is the documentary stamp tax on the deed?
    a. $818.30
    b. $817.95
    c. $642.85
    d. $409.15
A

A

26
Q
  1. How is the buyer’s binder deposit entered on the closing statement?
    a. Debit to buyer only
    b. Credit to buyer only
    c. Debit to seller and credit to buyer
    d. Debit to buyer and credit to seller
A

B

27
Q
  1. How is the purchase price entered on the closing statement?
    a. Credit to seller only
    b. Credit to buyer only
    c. Credit to seller and debit to buyer
    d. Credit to buyer and debit to seller
A

B

28
Q
  1. How are unpaid property taxes entered on the closing statement?
    a. Debit to seller only
    b. Debit to buyer only
    c. Credit to seller and debit to buyer
    d. Credit to buyer and debit to seller
A

A

Real Estate (21 decks)

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