Real Estate Math

A Delaware buyer closes on March 15. Prepaid homeowner's insurance of $1,800 per year was paid on January 1 for the full year. How much does the seller credit the buyer at closing (using a 365-day year)?

A$1,449.00✓ Correct

B$900.00

C$1,400.00

D$1,200.00

Explanation

Days remaining after March 15: March 16 to Dec 31 = 16+30+31+30+31+30+31+31+28+31 = no, count from March 16 to Dec 31: 16 (Mar) + 30 (Apr) + 31 (May) + 30 (Jun) + 31 (Jul) + 31 (Aug) + 30 (Sep) + 31 (Oct) + 30 (Nov) + 31 (Dec) = 291 days. Daily rate = $1,800 ÷ 365 = $4.

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