Chapter 22 - Closing Procedures

Question 1

One a closing statement, items of expense that are incurred buy not yet payable, such as interest on a mortgage loan or taxes on real property.

Answer 1

accrued item

Question 2

The consummation of a real estate transaction, when the seller delivers title to the buyer in exchange for payment by the buyer of the purchase price.

Answer 2

closing

Question 3

The person responsible to conducting the settlement of a real estate sale.

Answer 3

closing agent

Question 4

A detailed cash accounting of a real estate transaction showing all cash received, all charges and credits made, and all cash paid out in the transaction.

Answer 4

closing statement

Question 5

An individual, partnership, corporation, or Texas government agency that seeks or acquires, by purchase or lease, any goods or services, as defined by the Texas Deceptive Trade Practices Act.

Answer 5

consumer

Question 6

Person to whom a debtor owes a debt or an obligation, a lender.

Answer 6

creditor

Question 7

A standard form that shows all charges imposed on borrowers and sellers in connection with the closing. An accounting of the parties’ debits and credits.

Answer 7

Closing Disclosure

Question 8

The closing of a transaction, usually the sale of real property.

Answer 8

consummation

Question 9

On a closing statement, an amount entered in a person’s favor - either an amount the party has paid or an amount for which the party must be reimbursed.

Answer 9

credit

Question 10

On a closing statement, an amount charges, that is, an amount that a party must pay.

Answer 10

debit

Question 11

Irrevocable deposit of the executed deed, purchase money, and instructions into escrow pending performance of escrow conditions.

Answer 11

doctrine of relation back

Question 12

The closing of a transaction through a third party called an escrow agent, or escrowee, who receives certain funds and documents to be delivered on the performance of certain conditions outlined in the escrow agreement.

Answer 12

escrow

Question 13

three-page standard form required by the Consumer Financial Protection Bureau (CFPB) to be provided by a lender the a potential borrower within 3 days of a completed loan application but not late than seven days before closing.

Answer 13

Loan Estimate

Question 14

Item on a closing statement that has been paid in advance by the seller, such as insurance premiums, which must be reimbursed to the seller by the buyer.

Answer 14

prepaid item

Question 15

To divide or distribute expenses, either prepaid or paid in arrears, between buyer and seller at the closing (such as taxes, interest, and rents).

Answer 15

prorate

Question 16

A federal law, enacted in 1974 and later revised, that ensures the buyer and the seller in a real estate transaction receive information of all settlement costs when the purchase of a one-to-four family residential dwelling is financed by a federally related mortgage loan. Protects consumers from abusive lending practices.

Answer 16

Real Estate Settlement Procedures Act (RESPA)

Question 17

A law, effective October 2015, that is part of the Dodd-Frank Wall Street Reform and Consumer Protection Act. It requires that lenders make certain disclosures to home loan applicants before loan closings. Must be received 3 business days before closing.

Answer 17

TRID Rule variance

Question 18

A law, effective October 2015, that is part of the Dodd-Frank Wall Street Reform and Consumer Protection Act. It requires that lenders provide the Loan Estimate to the borrower. Must be received 3 business days before closing.

Answer 18

TRID Rule variance