Escrow & Title

Proration at closing adjusts items paid in advance or in arrears. If the seller prepaid annual property taxes of $3,600 and closes on September 1, how much does the buyer owe the seller for taxes (using a 360-day year)?

A$900
B$1,200✓ Correct
C$1,500
D$2,400

Explanation

Taxes prepaid for the full year: $3,600. Seller owned through September 1 (244 days) — buyer owns Oct–Dec (122 days).

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