Chapter Twenty Two Flashcards
an event where promises made in a sales contract are fulfilled and mortgage loan funds (if any) are distributed to the buyer. 398
closing
on a closing statement, items of expense that are incurred but not yet payable, such as interest on a mortgage loan or taxes on real property. 414
accrued items
a detailed cash accounting of a real estate transaction showing all cash received, all charges and credits made, and all cash paid out in the transaction. 412-414
closing statement
an arrangement where a package of services (e.g., a real estate firm, title insurance company, mortgage broker, and home inspection company) is offered to consumers. 406
controlled business arrangements (CBA)
on a closing statement, an amount entered in a person’s favor - either an amount the party has paid or an amount for which the party must be reimbursed. 425
credit
on a closing statement, an amount charged; that is, an amount that the debited party must pay. 425
debit
the trust account established by a broker under the provisions of the license law for the purpose of holding funds on behalf of the broker’s principal or some other person until the consummation or termination of transaction 229-230
escrow account
a disinterested third party is authorized to act as escrow agent (escrow holder) and to coordinate the closing activities on behalf of the buyer and the seller. 402-403
escrow closing
a HUD form that estimates all closing fees that must be provided to a borrower within three days of the loan application as required by the Real Estate Settlement Procedures Act (RESPA). 407
Good Faith Estimate (GFE)
an account that most mortgage lenders require borrowers to have for funds to pay future real estate taxes and insurance premiums. 229-230
impound account
the timeless of certain disclosures affects the date of closings. Lenders and licensees need to keep three numbers in mind: 3-7-3–three business days to provide a truth-in-lending statement (TIL) and good-faith estimate (GFE); three business dayus for closing if the APR has changed more than 0.125 percent from the original or most recent TIL and GFE; and three business days before closing to provide consumer with copy of appraisal. 404-405
Mortgage Disclosure Improvement Act (MDIA)
on a closing statement, items that have been paid in advance by the seller, such as insurance premiums and some real estate taxes, for which the seller must be reimbursed by the buyer. 414
prepaid items
expenses, either prepaid or paid in arrears, that are divided or distributed between the buyer and the seller at the closing. 414
prorations
the federal law that requires certain disclosures to consumers about mortgage loan settlements. The law also prohibits the payment or receipt of kickbacks and certain kinds of referral fees. 405-406
Real Estate Settlement Procedures Act (RESPA)
the process by which boundaries are measured and land areas are determined; the on-site measurement of lot lines, dimensions, and position of a house on a lot, including the determination of any existing encroachments or easements. 144
survey
