FIN 368 Final Exam Study Guide - CHAPTER 20? I. Closing A....

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CHAPTER 20? I. Closing A. Face-to-face-- Buyer, seller, broker, lender, settlement agent 1. Broker—makes deal happen- involvement depends on broker (cannot practice law) 2. Attorney—can represent all parties- maybe prepares documents 3. Seller—supplies deed prepared by attorney, gets marketable title ; remove encumbrances; provide tax receipts 4. Buyer—check deed (what kind, easements, legal description, etc.) by going to courthouse where seller was buyer, secure financing/insurance ; examine title 5. Settlement agent—makes transaction happen B. Takes place at title company, etc. or lender’s place, etc. C. Seller brings deed- buyer brings cash II. Documents to be recorded after closing— A. Release of mortgage B. Deed C. New mortgage III. RESPA—Real Estate Settlement Procedures Act A. Applies if lender is federally regulated institution and borrower is borrowing for residential B. Protects borrower from unfair lending practices 1. Good faith estimate of settlement charges 2. Booklet explaining settlement process within 3 days 3. Supposed to give buyer settlement statement day before closing C. Prohibits 1. Phantom charges 2. Kickbacks 3. Refusal to supply borrower with good faith estimate IV. Settlement statement A. Purpose of prorations B. Calculate tax proration and interest paid to lender at closing CHAPTER 14? I. Escrow company handles transaction- buyer and seller apart A. Escrow agreement/escrow instructions 1. Seller sends deed and instructions to escrow agent, buyer sends money and instructions B. Complete when escrow agent delivers deed to buyer and money to seller II. Broker’s Escrow Account – example of the use of the term “escrow” that does not mean the same thing as an escrow closing III. Mortgage Account Escrow—deposited with lender to pay taxes and insurance IV. Advantages to Escrow
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This note was uploaded on 09/27/2011 for the course FINANCE 368 taught by Professor Phillips during the Spring '11 term at Missouri State University-Springfield.

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FIN 368 Final Exam Study Guide - CHAPTER 20? I. Closing A....

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