SU # 27__Buyer Counseling - Closing Costs Flashcards
What do the buyer and seller receive at closing?
The buyer receives clear title and the seller receives payment for the property.
Under what circumstances would a seller pay loan fees?
The seller may be required to pay a prepayment penalty for paying off the mortgage before the original due date.
What is the definition of the taxable consideration that is used to compute the real estate transfer tax?
Taxable consideration is the amount that remains after subtracting the value of any personal property that is included in the sale and the amount of the outstanding mortgage on the property from the actual sale price of the property.
What part of the title expenses are typically paid by the seller?
In Illinois, the seller usually pays for the owner’s title insurance policy.
List three lender fees that the buyer would pay and describe what they are.
Application fee – What the lender charges to process the application.
Underwriting fee – What the underwriter charges for reviewing the loan application and approving the loan.
Origination fee – What the lender charges for finding the loan - is equal to 1% of the loan amount.
What transfer taxes might the buyer be liable for?
transfer taxes at the local or municipal level.
For what reason does a lender require a buyer to set up an escrow account?
to accrue monies for taxes and insurance, which the lender will pay when they become due.
What are three items that should be taken into account when setting a closing date?
The buyer’s requirements – The buyers may need to sell their existing home.
The seller’s requirements – The sellers may need to find a new home.
The loan process – The buyer must have enough time for qualification and approval.
What is a fee charged to secure a specific interest rate?
Lender’s Rebate Fee
Take Fee
Recording Fee
Loan Lock Fee
Loan Lock Fee
When does an Assumption Fee apply?
When the seller pays off the entire loan
When the buyer assumes the seller’s existing loan.
When the buyer assumes two loans.
When the lender drafts a PMI loan.
When the buyer assumes the seller’s existing loan.
What tax is imposed on any deed or instrument which conveys interest in real property?
Impound Tax
Property Exchange Tax
Render Tax
Real estate transfer tax
Real estate transfer tax
Which of the following charges does the buyer usually pay?
Existing liens
Survey fees
Broker’s Commission
Lender Fees
Lender Fees
Which document is used to show the amount of taxable consideration that was used to determine the transfer taxes?
Taxable Income Tax Form
Real Estate Transfer Declaration
Form 2133 IRS
Deed Order Tax Declaration
Real Estate Transfer Declaration
A falsified Real Estate Transfer Declaration is a ___________.
Class A misdemeanor
Class B misdemeanor
Class C misdemeanor
Class B-1 misdemeanor
Class B misdemeanor
Which of the following deeds are exempt from transfer tax?
Partitions
Residential
Land valued at $37,800 or less.
Chattled Deeds
Partitions
