N14 Settlement, Prorations & Investments Flashcards Preview

Real Estate National Key Facts > N14 Settlement, Prorations & Investments > Flashcards

Flashcards in N14 Settlement, Prorations & Investments Deck (22)
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1

A complete detailed statement showing all receipts and disbursements for a transaction and required by the CFPB is a _________ formerly known as the _______.

Closing Disclosure, HUD-1 Settlement Statement.

2

A proportional division or distribution of monies between buyers and sellers or landlords and tenants is a _________.

Proration

3

When prorating items in Arizona, the _______ ,or in a lease the _______ is the person usually responsible to pay for items for the day of closing.

Buyer, Tenant

4

When prorating, items paid in arrears (that have not been paid) are a Charge (Debit) to the ___ and a Credit to the ____.

seller, buyer

5

When prorating, items paid in advance (that have been prepaid) are a ___ to the seller and a _____to the buyer.

Credit, Charge (Debit)

6

Unless negotiated differently, closing costs on a loan are usually paid by the ______________.

Buyer (Borrower)

7

The owner’s title insurance policy is usually paid for by the __________.

Seller

8

The projected income on an investment property as if the property was 100% occupied is the ___________

Gross Scheduled Income.

9

If rent was uncollectable by a landlord it is considered to be a _____________.

Credit Loss

10

The actual income a rental property produces is _________ AKA _____________.

Effective Gross Income aka Gross Operating Income

11

Expenses incurred in running an income property are defined as ___________.

Operating Expenses

12

The income remaining after operating expenses are deducted from the effective gross income is the ___________.

Net Operating Income

13

The principal and interest paid on a loan are defined as the _________ on an income property.

Debt Service

14

The amount remaining after paying all operating expenses and debt service is defined as the _________.

Cash Flow Before Income Tax

15

The two items related to owner-occupied property that may be taken as a tax deduction are __________ and ___________.

Mortgage Interest and Property Taxes

16

In the sale of a personal residence the maximum amount of capital gain that, under certain circumstances, may not be taxed is ________ for a single person and ______ for a married couple filing jointly.

$250,000, $500,000

17

For owners of income property the three items that are eligible for deductions on the owner’s tax return are:

Mortgage Interest, Property Taxes and Cost Recovery (Depreciation).

18

Cost recovery/depreciation may not be taken as an income tax deduction on ______________ or _______.

Land or a Personal Residence

19

The period over which an income producing property may be depreciated for tax purposes is known as the ___________.

Recovery Period

20

Residential income property may be depreciated over a recovery period of ___ years.

27.5

21

Non-residential income property may be depreciated over a recovery period of __ years.

39

22

When the allowable annual depreciation is the same amount each year, the depreciation is classified as ____________.

Straight Line Depreciation