UNIT 8 - ESCROW & CLOSING

Question 1

conditional delivery

Answer 1

second requirement for a valid escrow. it means the seller will deliver a signed instrument of conveyance, and the buyer/lender will deliver to escrow whatever funds are required for the sale, per the contract

Question 2

prorations

Answer 2

the division of expenses and income between the buyer and seller as of the date of closing. some examples (taxes, rental deposits)

Question 3

preliminary report

Answer 3

an offer to issue a policy of title insurance covering a particular estate or interest in land subject to stated exceptions

Question 4

demand for payoff

Answer 4

if there exist loans to be paid off, the loan officer uses this.

Question 5

beneficiary statement

Answer 5

statement of the unpaid condition of a loan and describes the condition of the debt

Question 6

short rate cancellation fee

Answer 6

penalty to the person who cancels the insurance policy before it expires

Question 7

settlement statement

Answer 7

complete breakdown of all cash received, all charges and credits made, and all costs involved in the transaction

Question 8

impound account

Answer 8

trust acct set up for funds set aside for future recurring costs relatd to the property

Question 9

cash reconciliation statement

Answer 9

completed by escrow holder, where closing statements are prepared for all principals

Question 10

marketable title

Answer 10

a title clear and free from likely challenge

Question 11

abstract of title

Answer 11

a written summary of all useful documents discovered in a title search

Question 12

certificate of title

Answer 12

states that the property was properly vested in the present owner

Question 13

guarantee of title

Answer 13

written assurances about the title to real property

Question 14

title insurance

Answer 14

need for reliable assurance of title

Question 15

title plant

Answer 15

information regarding property organized in lot books

Question 16

rebate law

Answer 16

requires title insurance companies to charge for preliminary reports and to make sincere efforts to collect for them.

Question 17

lot, block, and tract system

Answer 17

using subdivision map

Question 18

public land survey system

Answer 18

using longitude/latitude (meridians/baselines)

Question 19

township

Answer 19

6x6 mile square

Question 20

feet in mile

Answer 20

5280

Question 21

metes and bounds

Answer 21

measures distance between landmarks to identify property

Question 22

documentary transfer tax

Answer 22

a tax on the equity transfered, whenever real property is transferred from one owner to another