key terms Flashcards
(25 cards)
the point at which ownership of a property is transferred in exchange for the selling price
closing
at the closing, the ___ is transferred in exchange for ___.
title to the real estate
payment of the purchase price
a thorough knowledge of the ___ is the best defense against the risk of a transaction failing
closing process
Provides information about the exact location and size of the property
Survey
Encumbrances on the real estate or claims on the title
Clouds on the title
The second search of public records
bring-down
a sworn statement in which the seller assures the title insurance company (and buyer) that there have been no judgments, bankruptcies, or divorces involving the seller since the date of the title examination
Affidavit of title
Payoff statement for an existing loan noting the unpaid amount of principal, interest due through the date of payment, fee for issuing the certificate of satisfaction or release deed, credits (if any) for tax and insurance reserves, and the amount of any prepayment penalties.
Estoppel Certificate
OR
Certificate of no defense
method of closing in which a disinterested 3rd party is authorized to act as an escrow agent and to coordinate the closing activities
Closing in escrow
A federal law that requires certain disclosures about the mortgage and settlement process and prohibits certain practices that increase the cost of settlement services, such as “kickbacks” and referral fees.
Real Estate Settlement Procedures Act (RESPA)
Legislation passed to make it easier for consumers to understand the costs involved in closing
TILA-RESPA Integrated Disclosure Rule (TRID)
TILA-RESPA Integrated Disclosure Rule replaced the 4 previous disclosure forms with 2 new forms: ___ and ___
1) the loan estimate
2) the closing disclosure
Practice of one company offering a package of services to consumers
Affiliated Business Arrangement (ABA)
When the lender has received the following info regarding the loan: address of property, loan amount, income of borrower, contract value of the property, name of borrower, SSN of the borrower.
Application
the date that the borrower and lender are contractually obligated to each other
Consummation
A day on which the creditor’s offices are open to the public for carrying out substantially all of its business functions.
Business day
Tells the borrower whether the lender intends to service the loan or to transfer it to another lender. It also provides information about resolving complaints
Mortgage Servicing Disclosure Statement
Expenses, either prepaid or paid in arrears, that are divided or distributed between buyer and seller at closing
Prorations
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
accrued item
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 she must be reimbursed by the buyer
Prepaid item
A(n) ___ year contains 12 months with 30 days in each month, total of 360 days
statutory year
A(n) ___ year contains 12 months with 28-31 days in each month for a total of 365 days or 366 in a leap year
Calendar
Proration method in IL where the yearly charge is divided by 12 to determine a monthly amount. The monthly charge then is divided by the actual number of days in the month in which the closing occurs. This final number is the daily charge for that month.
Statutory month variation
The part that is prepaid from the date of closing to the end of the month
Unearned portion
