CHCP Settlement Statement Preparation 3

Question 1

Under TRID, how many business days before consummation must a buyer generally receive the Closing Disclosure?

Accepted Answer

3 business days

Answer

TRID requires lenders to deliver the Closing Disclosure to the borrower at least three business days before consummation of the loan.

Question 2

Which of the following is typically a buyer's debit on the settlement statement?

Accepted Answer

Sales price

Answer

The sales price is a debit to the buyer because it represents an obligation the buyer must pay to purchase the property.

Question 3

Recording fees for the deed are customarily charged to which party on the settlement statement?

Accepted Answer

The buyer

Answer

Recording fees for the new deed are customarily a buyer's expense because the buyer benefits from having the deed recorded in their name.

Question 4

A buyer is purchasing a home for $400,000 with a 20% down payment. What is the loan amount that would appear on the settlement statement?

Accepted Answer

$320,000

Answer

20% of $400,000 is $80,000 (down payment), so the loan amount is $400,000 − $80,000 = $320,000.

Question 5

Which settlement statement line item represents interest charged on the loan from the closing date to the end of the first partial month?

Accepted Answer

Prepaid interest

Answer

Prepaid interest covers the per-diem interest from the consummation date through the last day of the month, before the first full monthly payment begins.

(CHCP) Certified Home Closing Professional Practice Test

(CHCP) Certified Home Closing Professional Practice Test

CHCP Settlement Statement Preparation 3