Section 14 TF Quiz

Question 1

Even though the lender’s title insurance is required by the buyer’s lender, it may be paid by the seller at closing.

Answer 1

[A] A. True
B. False

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[Section 14C, Slide 72]

Question 2

Security deposits held by seller are entered as a credit to the seller and a debit to the buyer.

Answer 2

A. True
[A] B. False

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[Section 14D, Slide 14]
.

Question 3

Usually, whichever party is to sign a particular closing document pays the fee for document preparation.

Answer 3

[A] A. True
B. False

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[Section 14C, Slide 61]

Question 4

The broker commission is usually paid by the seller or whoever employed the broker unless otherwise negotiated beforehand on the contract.

Answer 4

[A] A. True

B. False

Question 5

Intangible tax is paid on every dollar of both new mortgages and assumed mortgages at $.002.

Answer 5

A. True
[A] B. False

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[Section 14C, Slide 44]; Paid on new mortgages only not assumed mortgages.

Question 6

Items paid in arrears is entered as a credit to the seller and a debit to the buyer

Answer 6

A. True
[B] B. False

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[Section 14B, Slide 78]; Items paid in arrears are entered as a credit to the buyer and a debit to the seller. Items paid ahead are entered as a credit to the seller and a debit to the buyer

Question 7

The Closing Disclosure is the financial summary of the deal.

Answer 7

[A] A. True
B. False

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[Section 14B, Slide 70]

Question 8

A debit means that the person who gets the debit is being charged money.

Answer 8

[A] A, True
B. False

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[Section 14B, Slide 74]

Question 9

The statutory method means that you always use 30 days to calculate a monthly proration and 365 days to calculate a years proration.

Answer 9

A. True
[A] B. False

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[Section 14B, Slide 80]; Statutory methods means using 30 days for a month and 360 days for a year.

Question 10

Interest on an assumable mortgage is paid ahead, so seller gets a credit from the buyer at closing.

Answer 10

A. True
[A] B. False

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[Section 14C, Slide 19]; Interest on an assumable mortgage is paid in arrears, so the seller owes the buyer a credit at closing