Pratice Chapter 14 - Closing the Residential Transaction Flashcards
Closing
Process by which all the parties to a real estate transaction conclude the details of a sale or mortgage. The process includes the signing and transfer of documents and distribution of funds.
Chain of Title
A history of conveyances and encumbrances affecting the title from the time the original patent was granted, or as far back as records are available, used to determine how title came to be vested in current owner.
Abstract of Title
A summary or digest of all transfers, conveyances, legal proceedings, and any other facts relied on as evidence of title, showing continuity of ownership, together with any other elements of record which may impair title.
Marketable Title
Title which a reasonable purchaser, informed as to the facts and their legal importance and acting with reasonable care, would be willing and ought to accept.
Opinion of Title
An attorney’s written evaluation of the condition of the title to a parcel of land after examination of the abstract of title.
Title Insurance
Insurance to protect a real property owner or lender up to a specified amount against certain types of loss, e.g., defective or unmarketable title.
Real Estate Settlement Procedures Act (RESPA)
A federal law requiring the disclosure to borrowers of settlement (closing) procedures and costs by means of a pamphlet and forms prescribed by the United States Department of Housing and Urban Development.
Credit
A bookkeeping entry on the right side of an account, recording the reduction or elimination of an asset or an expense, or the creation of or addition to a liability or item of equity or revenue.
Debit
That which is due from one person to another.
Proration
Adjustments of interest, taxes, and insurance, etc., on a pro rata basis as of the closing or agreed upon date.
