Escrow & Title
A Washington property is sold and a buyer's closing costs include prepaid items. Which of the following is a prepaid item, not a closing cost?
ALoan origination fee
BHomeowner's insurance premium paid in advance✓ Correct
CTitle insurance premium
DRecording fees
Explanation
Prepaid items are expenses that must be paid in advance at closing, such as the first year's homeowner's insurance premium and prepaid interest. These are different from closing costs (which are one-time fees for services).
People Also Study
Related Washington Questions
- A Washington homeowner has a $350,000 loan at 6.5% interest only for the first year. What is the monthly interest payment?Real Estate Math
- A Washington listing has an annual property tax of $7,200 and a homeowner's insurance premium of $1,800/year. A buyer's monthly escrow payment for taxes and insurance alone is:Real Estate Math
- A Washington property's annual insurance premium is $2,400 and property taxes are $5,760. At closing on June 1, the seller's insurance is paid through December 31. How much is credited to the seller for insurance?Real Estate Math
- A Washington buyer purchases a property and later discovers that the prior owner had an unpaid IRS tax lien that wasn't paid at closing. The buyer's title insurance policy will:Escrow & Title
- A Washington borrower's lender requires that property taxes and homeowner's insurance be paid through an escrow impound account. The initial escrow deposit at closing typically covers:Finance
- A Washington seller agrees to pay two discount points to buy down a buyer's interest rate. If the loan amount is $380,000, what is the cost of the points?Finance
- A Washington property tax bill is $6,500 per year. The annual taxes are prorated at closing, and the seller has already paid the full year. The buyer closes on August 1. How much does the escrow company credit the seller?Real Estate Math
- A Washington lender charges origination fees and discount points at closing. Under TRID, these must be itemized on the:Finance
Key Terms to Know
Closing Costs
Fees 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.
Title InsuranceInsurance protecting against financial loss from defects in a property's title that existed before closing but were unknown at the time of purchase.
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.
ProrationThe division of ongoing property expenses (taxes, HOA dues, rents) between buyer and seller at closing based on their respective days of ownership.
Math Concepts
State-Specific Concepts
Recording Requirements
Study This Topic
Practice More Washington Real Estate Questions
1,500+ questions covering all exam topics. Start free — no signup required.
Take the Free Washington Quiz →