Escrow & Title
In a Kentucky real estate closing, proration of property taxes means:
AThe buyer pays all taxes due at closing
BTaxes are divided based on each party's period of ownership during the tax year✓ Correct
CThe lender escrows taxes for the entire year
DProperty taxes are waived for the first year after sale
Explanation
Proration allocates property taxes between buyer and seller based on the number of days each party owns the property during the tax year. Kentucky property taxes are paid in arrears, so the seller typically owes taxes for their portion of the current tax year through the closing date.
Related Kentucky Escrow & Title Questions
- A lis pendens is a recorded notice that:
- A Kentucky title search reveals a judgment lien recorded against the seller. At closing, the title company will typically:
- Under the RESPA (Real Estate Settlement Procedures Act), a Kentucky lender must provide a Loan Estimate to a borrower within:
- The seller's closing costs in a Kentucky transaction typically include:
- Kentucky does not require a deed to be recorded to:
- A Kentucky survey stakes the corners of a property and identifies an encroachment from a neighbor's building. This is known as:
- A quitclaim deed:
- A RESPA violation in Kentucky occurs when a lender pays a kickback to a title company for referring business. This is prohibited because:
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