Escrow & Title
What does 'proration' in a real estate closing mean?
ADividing the commission between the listing and selling brokers
BAllocating ongoing expenses (taxes, HOA dues, rents) between buyer and seller based on the closing date✓ Correct
CDistributing the purchase price proportionally to multiple sellers
DAdjusting the loan balance for prepaid interest
Explanation
Proration is the process of fairly dividing ongoing property costs and revenues between the buyer and seller as of the closing date. Items prorated at closing typically include property taxes, HOA dues, rents, and prepaid insurance.
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