Unit 14-closing Flashcards
For contract to close
You need agreements met and funding secured
Buyer pre closing procedures
Buyers Inspect:
Title evidence Seller deed Removal of liens and encumbrances Survey Inspection results Leases on premises Final walk through
Abstract of title
In letter it explains all easements, encumbrances, liens, conditions, restrictions
Payoff statement
Calculated to exact amount to payoff existing mortgage
The bring down
After closing, 2nd search of title
Prior to closing -agent
- Communication with loan officer
- Timeline for title search- closing lawer
- Apprisal
- inspections
- insure all dates are met
Seller before closing
- Payment
- Buyer financing
- Compliance with buyers requirements
Lender before closing
Pest control Reserve account-escrow Survey Inspection report Title insurance
1099-s
Closing must be reported to government
Don’t have to report as income
Seller does it
Closing syn
Settlement and transfer
Passing the papers
Closing in escrow
Types of closing
Face to face
Escrow closing
Escrow closing
Not face to face
Third party coordinates closing for buyer and seller
RESPA
- No kickbacks or referral fees (8)
- Need to give options in services(title insurance)-3x the amount fine (9)
- no excessive escrow account(10) 2month payment 1/6 of amount
- has to estimate Good faith estimate along with HUD-1 form
10k fine and 1 year in jail
Federal law
Real estate settlement procedure act
On residential property
First lien mortgage
2nd lien for home equity loan when FHA or FDIC
NOT APPLIED TO:
Business Over 25 acre Construction Vacant land Seller finance Temp financing Agriculture
Buyers assumption, unless it charges by more than $50
GFE
Good faith estimate
3 days after the application is submitted and 3 days before closing
Estimate of what I have to pay at closing
3 types
No tolerance
10% tolerance
Unlimited tolerance
Last page is worksheet to compare information
Steamline
RESPA
parts of ABA/CBA ( Affiliated/controlled business arrangements)
Allows you to recommend services
One stop shopping( takes care of multiple things)
Uniform settle statement(HUD-1)
Closing statement
Exact cost
Requirement from RESPA
Allowed to see this one day before closing(only buyer can see it at this time. Not seller)
Lender needs to keep HUD-1 for 2 years
RESPA summary
CLO regulation- computer loan origination CBA/ABA disclosure Settle cost booklet GFE HUD-1 No kickbacks
Debit and credit
Debit amount to be paid
Credit is amount already paid or promised
Accrued items
Can be prorated
Will be paid in future
Taxes-accrued
Insurance- pre paid
Proration
Divvying up what is owed
Closing
When a contract is executed. The gilatine has fallen
MDIA - Mortgage disclosure act
Requires loan cost to be disclosed to customers. A GFE is required within three days of application lender must wait seven days after that to close the loan if changes are made another three day wait
Mortgage servicing transfer statements
Minimum of 15 day notice if the lender Intends to sell loan.
