ContractsIntermediateColorado Exam

In Colorado, the 'Seller's Disclosure of Settlement Costs' provision in the CBS contract means:

AA. The seller must pay all closing costs
BB. The seller agrees to itemize all concessions or credits being given to the buyer, which must be disclosed to the lenderCorrect
CC. The title company must approve all seller credits, though specific requirements can vary depending on the transaction details
DD. The seller receives a detailed cost breakdown

Why B. The seller agrees to itemize all concessions or credits being given to the buyer, which must be disclosed to the lender Is Correct

Answer B: B. The seller agrees to itemize all concessions or credits being given to the buyer, which must be disclosed to the lender

Seller concessions (credits to the buyer for closing costs) must be disclosed to the buyer's lender. Undisclosed concessions can constitute mortgage fraud.

Exam Tip: Contracts

Contract questions frequently test the essential elements required for a valid contract. Remember: competent parties, mutual consent, lawful object, and sufficient consideration. Watch for void vs. voidable distinctions.

Key Contracts Terms in This Question

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