Escrow & Title
In South Carolina, what is 'proration' at closing?
ADividing profits between buyer and seller
BAllocating ongoing expenses (like property taxes or HOA dues) between buyer and seller based on the closing date✓ Correct
CThe attorney's fee calculation
DThe process of verifying title insurance coverage
Explanation
Proration allocates property-related expenses paid in advance or arrears (property taxes, HOA fees, rent) between buyer and seller as of the closing date, ensuring each party pays their fair share for the time they own the property.
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Key Terms to Know
Title Insurance
Insurance protecting against financial loss from defects in a property's title that existed before closing but were unknown at the time of purchase.
ProrationThe division of ongoing property expenses (taxes, HOA dues, rents) between buyer and seller at closing based on their respective days of ownership.
Closing CostsFees and expenses paid by the buyer and/or seller at the closing of a real estate transaction, in addition to the property's purchase price.
Discount PointsPrepaid interest paid to a lender at closing to reduce the mortgage interest rate, with each point equal to 1% of the loan amount.
Math Concepts
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