assessment

Question 1

A(n) ___ provides information about the exact location and the size of the property

Answer 1

Survey

Question 2

The primary purpose of a(n) ___ is to verify that necessary repairs have been made, property has been well maintained, all fixtures are in place, and no unauthorized removal or alteration of any part of the improvements has taken place

Answer 2

final inspection (walk-through)

Question 3

A method of closing in which a disinterested 3rd party is authorized to act as escrow agent and coordinate closing activities

Answer 3

Escrow

Question 4

If the escrow agent’s examination of title discloses ___, a portion of the purchase price can be withheld from the seller

Answer 4

liens

Question 5

If the escrow agent’s examination of title discloses liens, a portion of the purchase price can be withheld from the ___

Answer 5

seller

Question 6

the ___ gives a full accounting of all credits and debits at closing

Answer 6

Closing disclosure

Question 7

the first disclosure a lender is required to give under TRID is the ___

Answer 7

loan estimate

Question 8

On the closing statement, the principal amount of the new mortgage is listed as a(n) ___ to the buyer

Answer 8

credit

Question 9

On the closing statement, the principal amount of the new mortgage is listed as a credit to the ___

Answer 9

buyer

Question 10

An amount to be paid by the buyer or seller.

Answer 10

Debit

Question 11

An amount payable to the buyer or seller

Answer 11

credit

Question 12

The division of financial responsibility between the buyer and seller

Answer 12

Prorations

Question 13

Shows loan terms and charges along with closing costs and cash needed to close

Answer 13

Closing Disclosure

Question 14

___ are paid by the seller but not fully used up

Answer 14

Prepaid expenses

Question 15

Given by the lender to the buyer / borrower within 3 business days of the loan application

Answer 15

Loan estimate

Question 16

Form used to report the closing to the IRS

Answer 16

1099-S

Question 17

Federal consumer law that requires certain disclosures about the mortgage and settlement process

Answer 17

RESPA

Question 18

___ are owed by the seller but will be paid later by the buyer

Answer 18

Accrued expenses

Question 19

Proration of real estate varies depending on….

Answer 19

how taxes are paid in the area where the real estate is located

Question 20

How are taxes in IL paid?

Answer 20

In arrears

Question 21

___ are necessary to ensure that expenses are divided fairly between the seller and buyer.

Answer 21

Prorations

Question 22

Closings must be reported to the IRS on form ___.

Answer 22

1099-S

Question 23

The Consumer Financial Protection Bureau (CFPB) implements the rule known as ___, which is a combination of disclosures associated with the Truth In Lending Act (TILA) and the Real Estate Settlement Procedures Act (RESPA).

Answer 23

TILA-RESPA Integrated Disclosures (TRID)

Question 24

What are the 2 main disclosures under TILA-RESPA Integrated Disclosures?

Answer 24

1) Loan Estimate
2) Closing disclosure

Question 25

Disclosure that details all aspects of the loan and an estimate of closing costs.

Answer 25

Loan estimate

Question 26

Disclosure that is a full accounting of funds at closing and additional information regarding the mortgage.

Answer 26

Closing disclosure

Question 27

___ requires disclosure of all settlement costs when a residential real estate purchase is financed by a federally related mortgage loan

Answer 27

RESPA

Question 28

RESPA requires disclosure of ___ when a residential real estate purchase is financed by a federally related mortgage loan

Answer 28

all settlement costs

Question 29

RESPA requires disclosure of all settlement costs when a(n) ___ real estate purchase is financed by a federally related mortgage loan

Answer 29

residential

Question 30

RESPA requires disclosure of all settlement costs when a residential real estate purchase is financed by a(n) ___

Answer 30

federally related mortgage loan

Question 31

Taxes paid in arrears means they are paid…

Answer 31

the year AFTER they become a lien

Question 32

Real estate taxes in IL are paid ___.

Answer 32

in arrears

Question 33

In addition to statutory year and calendar year, IL also permits proration by the ___ method.

Answer 33

statutory month variation

Question 34

The ___ normally pays for the owner's title insurance policy

Answer 34

seller

Question 35

The seller usually pays for the ___ title insurance policy

Answer 35

owner's

Question 36

The buyer usually pays for the ___ title insurance policy

Answer 36

lender's

Question 37

The ___ usually pays for the lender’s title insurance policy.

Answer 37

buyer

Question 38

the purpose of ___ is to give more transparency to the loan process

Answer 38

TILA-RESPA Integrated Disclosures (TRID)

Question 39

The purpose of TRID is to give more ___ to the loan process.

Answer 39

transparency

Question 40

Total charge divided by 12, then divided by the actual days in the moth of closing = the daily prorated charge for an annual prepaid expense using the ___ method

Answer 40

Statutory month variation

Question 41

In IL, which party normally pays the state and county transfer taxes?

Answer 41

Seller

Question 42

The document that provides borrowers with general information about their loan

Answer 42

Loan estimate

Question 43

If a seller collected a rent of $1,400 payable in advance from an attic tenant on April 1, the ___ owes the ___ $700

Answer 43

seller owes the buyer

Question 44

If a seller collected a rent of $1,400 payable in advance from an attic tenant on April 1, how much does the seller owe the buyer?

Answer 44

$700

Question 45

A building was purchased for $285,000 with 10% down and a loan for the balance. If the lender charged the buyer 2 discount points, how much cash did the buyer need to come up with at closing if the buyer incurred no other costs?

Answer 45

$33,630 285,000 times 0.10 (10%) = 28,500 285,000 - 28,500 = 256,500 256,500 x 0.02 = 5,130 5,130 + 28,500 = 33,630

Question 46

The ___ may be used to illustrate all settlement charges for residential mortgage transactions financed by federally related mortgage loans.

Answer 46

Closing disclosure

Question 47

Under TRID, if the APR increases by 0.125%, how many business days does the lender have to reissue another loan estimate?

Answer 47

3

Question 48

The principal amount of a purchaser's new mortgage loan is a(n) ___ to the ___.

Answer 48

credit to the buyer

Question 49

Security deposits are listed on a closing statement as a(n) ___ to the ___

Answer 49

credit to the buyer

Question 50

All encumbrances and liens shown on the report of title (other than those waived or agreed to by the purchaser and listed in the contract) must be removed so that the title can be delivered free and clear. The removal of such encumbrances is the duty of the ___.

Answer 50

seller

Question 51

In IL, which party customarily prepares the closing statement?

Answer 51

Seller's attorney

Question 52

Which of these would a lender generally require at the time of closing? a) credit report b) market value appraisal c) application d) title insurance

Answer 52

Title insurance

Question 53

Consummation may occur ___ days after the issuance of the closing disclosure

Answer 53

3 business days

Question 54

A buyer of a $300,000 home has paid $22,000 as earnest money and has a loan commitment for 70% of the purchase price. How much more cash does the buyer need to bring to the closing, provided the buyer has no closing costs?

Answer 54

$68,000 300,000 x 0.30 (30%) = 90,000 90,000 - 22,000 = 68,000

Question 55

At closing, the listing broker's commission is usually shown as a(n) ___ to the ___.

Answer 55

Debit to the seller

Question 56

When does legal title pass from seller to buyer?

Answer 56

When the deed is delivered and accepted

Question 57

At the closing of a real estate transaction, the person performing the settlement gave the buyer a credit for certain accrued items. These items were bills relating to the property that will have to be paid...

Answer 57

by the buyer

Question 58

If the annual real estate taxes on a property were $2,129 last year, what would be the per diem amount for prorations this year using the actual number of days method?

Answer 58

$5.83 2,129 divided by 365 = 5.83

Question 59

The earnest money left on deposit with the seller's real estate broker is a(n) ___ to the ___.

Answer 59

credit to the buyer

Question 60

The closing disclosure may be used to illustrate all settlement charges for ___ mortgage transactions financed by ___

Answer 60

residential federally related mortgage loans.