study guide chapter 14

Question 1

Binder Deposit:

Answer 1

Shows as credit to the buyer on the Closing Disclosure (pg 266)

Question 2

Purchase Money Mortgage (PMM)

Answer 2

Purchase Money Mortgage (PMM) is a mortgage financed by the seller. Prepaid
interest on a new mortgage including a PPM is recorded as a “Debit to Buyer/Credit to
Seller at Closing. (pg 264)

Question 3

Expenses

Answer 3

Expenses are recorded as Debits only. No credits in this sec on (pg 269)

Question 4

State Doc Stamps on the Deed:

Answer 4

Tax paid at closing based on the purchase Price.
The amount is all counties except Miami Seventy cents per hundred dollars of sales Price plus seventy cents for any fractional part of a hundred dollars of sales Price. Miami is $0.60 instead of $0.70. (pg 266)

Question 5

Intangible Tax:

Answer 5

Tax paid at closing based on NEW mortgages ONLY. NOT ASSUMED! Rate is 2 mills or .002 -No tax units are calculated (pg 268) —–ONLY NEW, NEVER ASSUMED–