Unit 14

Question 1

Closing

Answer 1

Point at which ownership is transferred in exchange for a selling price (settlement and transfer)

Question 2

To complete a transaction, the buyer requires

Answer 2

Survey, title evidence, inspections results, affidavit of title from seller, docs showing removal or prior encumbrances, deed from seller, lease (if applicable), final walk-through, closing statement showing amount and distribution of funds

Question 3

To complete the transaction, the seller requires

Answer 3

Payoff statement from lender noting amount owed, evidence buyer has necessary funds, closing statement showing distribution of funds

Question 4

IRS requires

Answer 4

Completion and submission of Form 1099-S statement of income to seller showing SS#. Filed by a closing agent or mortgage lender, real estate professional liable for the filing

Question 5

Escrow holder(agent)

Answer 5

A disinterested third party authorized to coordinate the closing activities

Question 6

Real Estate Settlement Procedures Act

Answer 6

Federal law enacted to protect consumers in the settlement process by requiring accurate and timely info about actual costs of a transaction, eliminating kickbacks and other referral fees, prohibiting seller from requiring buyer to buy title insurance from a particular company, and prohibiting lenders from requiring excessive escrow account deposits
-Does not apply to transaction financed solely by a purchase-money mortgage taken back by seller, installment contacts, or a buyer’s assumption of seller’s existing loan

Question 7

CFPB- Your Home Loan Toolkit

Answer 7

Booklet that must be provided by a lender to every person form whom they receive or for whom they prepare a loan application (except for refinancing)

Question 8

Loan Estimate form

Answer 8

Must be provided to borrower no later than 3 business days after receiving loan application. Created by CFPB on transactions originating on or after Oct 3, 2015.

Question 9

Closing Disclosure

Answer 9

Given to borrower and seller itemized all charged to be paid in connection with closing. Created by CFPB on transactions originating on or after Oct 3, 2015.

Question 10

Affiliated business arrangements (ABA)

Answer 10

that make use of companies with a shared ownership require notice to clients

Question 11

Mortgage Servicing Transfer Statement

Answer 11

Must be given by the lender to the borrower if lender intends to sell or assign the servicing rights to the borrower’s loan

Question 12

Closing statement

Answer 12

Involves an accounting of the amounts paid by or received by the parties

Question 13

Debit

Answer 13

(give) is a charge that must be paid by the buyer or seller at closing

Question 14

Credit

Answer 14

(receive) is the amount entered in favor of the buyer or seller