South Carolina Escrow & Title
Practice Questions & Answers (2026)
Escrow, title, and closing questions on the South Carolina exam test how real estate transactions are closed, how title is transferred, and what happens at settlement. South Carolina requires a licensed attorney to conduct real estate closings — unlike escrow states — which shapes how these questions are framed on the SC exam. Title insurance, title searches, and the difference between standard and extended coverage policies are tested, as are the specific closing costs that are customarily paid by buyers vs. sellers under South Carolina practice.
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South Carolina Escrow & Title — Practice Questions & Answers
114 questions on Escrow & Title from the South Carolina real estate question bank. First 10 are free — sign up to unlock all 114.
Q1. In South Carolina, deed stamps (recording fee) are paid at the rate of $1.85 per $500 of consideration. On a $300,000 home sale, how much are the total deed stamps?
Explanation
Deed stamps: $300,000 ÷ $500 = 600 units. 600 × $1.85 = $1,110. By custom in South Carolina, this cost is typically split between buyer and seller or paid by the seller.
Q2. A 'marketable title' means:
Explanation
Marketable title (also called merchantable title) is one that a reasonable buyer can accept without fear of litigation — it is free from significant encumbrances, liens, or defects. Most purchase contracts require the seller to convey marketable title at closing.
Q3. Which of the following would be found as an exception on a title insurance commitment?
Explanation
Title insurance commitments list exceptions — items that are not covered by the policy. Known easements, deed restrictions, and other encumbrances that are already of record would be listed as exceptions, meaning the policy will not cover losses arising from those specific items.
Q4. In South Carolina, who is typically responsible for paying for the owner's title insurance policy?
Explanation
In South Carolina, it is customary for the seller to pay for the owner's title insurance policy, as it is part of the seller's obligation to deliver clear, marketable title. However, this is negotiable and can be specified otherwise in the purchase contract.
Q5. South Carolina is an 'attorney state' for real estate closings. This means:
Explanation
South Carolina requires that a licensed attorney conduct or directly supervise real estate closings. The closing attorney handles title examination, closing documents, and disbursement of funds.
Q6. In South Carolina, the deed transfer tax (deed recording fee) is charged at what rate?
Explanation
South Carolina charges a deed recording fee (transfer tax) of $1.85 per $500 (or fraction thereof) of the consideration paid, typically paid by the seller at closing.
Q7. Who traditionally pays the deed recording fee (transfer tax) in South Carolina?
Explanation
In South Carolina, the deed recording fee (transfer tax) of $1.85 per $500 of consideration is traditionally paid by the seller, though this can be negotiated in the purchase contract.
Q8. A title search in South Carolina reveals a 'cloud on title.' This means:
Explanation
A cloud on title refers to any claim, lien, encumbrance, or defect that may impair or challenge clear title to a property, potentially preventing a sale or refinancing.
Q9. An owner's title insurance policy in South Carolina protects:
Explanation
An owner's title insurance policy protects the buyer against losses arising from title defects, liens, or encumbrances that existed before the closing date but were not discovered during the title search.
Q10. In South Carolina, an escrow account held by a broker must:
Explanation
South Carolina law requires broker escrow accounts to be maintained at federally insured financial institutions. The broker may not commingle client funds with personal or operating funds.
Q11. What is the purpose of a HUD-1 Settlement Statement (or Closing Disclosure) in a South Carolina real estate transaction?
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