Chapter 14 Section 1

Question 1

closing

Answer 1

-the final act that concludes the contract between buyer and seller
-all money due is paid, all costs are allocated and paid, and title is conveyed to buyer

Question 2

closing disclosure

Answer 2

-purpose of the closing disclosure is to provide the final details of loan terms, fees, and closing costs as of the day of closing

Question 3

allocation of charges

Answer 3

-the sales contract addresses who will pay for each item, and if nothing is negotiated to the contrary, the charges will be assessed as stated in the contract
-this is known as allocating the charges according to custom

Question 4

closing disclosure pages

Answer 4

-loan terms
-closing costs details
-summaries of transactions
-loan disclosures
-loan calculations, additional disclosures, and contact information

Question 5

page 1 loan terms

Answer 5

-lists the buyer’s loan information including the loan amount, interest rate, prepayment penalty or ballon payment, projected monthly payments and the amount of cash the buyer will need to bring to closing

Question 6

page 2 closing costs details

Answer 6

-lists the loan costs and other expenses charged to the buyer or seller

Question 7

page 3 summaries of transactions

Answer 7

-summarizes the entire transaction with a side-by-side view of the borrower’s and seller’s transactions

Question 8

page 4 loan disclosures

Answer 8

-provides more detailed information about the loan

Question 9

page 5 loan calculations, addnl disclosures, and contact info

Answer 9

-provides additional explanations related to the loan, along with contact information for the lender, closing agent (title company), and real estate brokers

Question 10

closing worksheet parts

Answer 10

-seller’s statement
-buyer’s statement
-broker’s statement

Question 11

prorations

Answer 11

-expenses and receipts that are divided proportionately between the buyer and seller
-all entries in the prorations and prepayments section are always double-line entries