The Closing Disclosure (CD) replaced which form in 2015?
Why The HUD-1 Settlement Statement and the Good Faith Estimate Is Correct
Answer A: The HUD-1 Settlement Statement and the Good Faith Estimate
Exam Tip: Escrow & Title
Escrow questions test the neutral third-party role and the sequence of closing events. Remember that the escrow agent acts as a dual agent for both buyer and seller and cannot advocate for either side.
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- In a typical Alabama residential closing, who prepares the HUD-1 or Closing Disclosure?Escrow & Title
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- Which of the following items is typically a CREDIT to the buyer on the closing disclosure?Escrow & Title
- The Closing Disclosure (CD) must be provided to the buyer at least how many business days before closing?Escrow & Title
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Key Terms to Know
Insurance protecting against financial loss from defects in a property's title that existed before closing but were unknown at the time of purchase.
Loan-to-Value Ratio (LTV)The ratio of a mortgage loan amount to the appraised value or purchase price of a property, expressed as a percentage.
Discount PointsPrepaid interest paid to a lender at closing to reduce the mortgage interest rate, with each point equal to 1% of the loan amount.
Pre-ApprovalA lender's conditional commitment to loan a specific amount to a borrower, based on verified income, credit, and assets.
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