Podcast
Questions and Answers
Which of the following best describes the purpose of a title search in a real estate transaction?
Which of the following best describes the purpose of a title search in a real estate transaction?
- To calculate the broker's commission for the seller.
- To determine the ownership and encumbrances affecting the property. (correct)
- To estimate the immediate upkeep costs for the purchaser.
- To provide title insurance to the buyer.
A buyer is purchasing a property for $1,200,000. How much is the real estate transfer tax?
A buyer is purchasing a property for $1,200,000. How much is the real estate transfer tax?
- This tax is only paid by the seller.
- $12,000 (correct)
- $6,000
- $0, as cooperatives are exempt from this tax.
Which of the following closing costs is typically the responsibility of the seller?
Which of the following closing costs is typically the responsibility of the seller?
- Mortgage recording tax
- State transfer tax (correct)
- Appraisal fee
- Move-in deposits
Which of the following BEST describes 'Chain of Title'?
Which of the following BEST describes 'Chain of Title'?
Which document details the fees, commissions, and insurance involved in transferring property ownership?
Which document details the fees, commissions, and insurance involved in transferring property ownership?
A seller lives out of state and is selling a property in NYC. What is a potential closing cost they should anticipate that a local seller might not?
A seller lives out of state and is selling a property in NYC. What is a potential closing cost they should anticipate that a local seller might not?
Approximately, what range can one expect loan fees to be relative to the total loan amount?
Approximately, what range can one expect loan fees to be relative to the total loan amount?
Which document is typically submitted when a loan is involved in a real estate transaction?
Which document is typically submitted when a loan is involved in a real estate transaction?
Flashcards
Title (Property)
Title (Property)
Legal rights associated with owning property, encompassing legal or equitable interests.
Marketable Title
Marketable Title
A title free from defects, legally acceptable to a buyer.
Title Search
Title Search
Review of public records to determine property ownership and encumbrances.
Chain of Title
Chain of Title
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Abstract of Title
Abstract of Title
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Title Insurance
Title Insurance
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Closing Statement
Closing Statement
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Real Estate Transfer Tax (Luxury)
Real Estate Transfer Tax (Luxury)
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Study Notes
- CATTL is an acronym for Checks, ACRIS, Title, Transfer, Loan.
Title
- Title is the legal term describing the bundle of rights in a piece of property, where a party can own a legal or equitable interest.
- Marketable Title is deemed by a court of equity as free from defect, legally compelling a buyer's acceptance.
- Title Search is the examination of public records to determine property ownership and encumbrances.
- Chain of Title refers to the historical sequence of property title transfers from the current owner back to the original owner.
- Abstract of Title is a summary of recorded instruments and proceedings affecting property title, arranged chronologically.
- Title Insurance is a policy that protects the holder against losses from title defects.
- Closing Statement is a document detailing transaction fees, commissions, and insurance for a successful property ownership transfer.
Purchaser's Closing Costs
- Immediate upkeep cost
- Mortgage principal and interest
- Common, maintenance charges and HOA dues
- Appraisal and inspection fees
- Title insurance
- Mortgage recording tax (applies to condos or houses, but not co-ops)
- Move-in and escrow deposits
- A real estate transfer tax, is paid by the buyer if the purchase exceeds $1 million; the tax is 1% of the purchase price.
Seller's Closing Costs
- State transfer tax is typically 1%
- NYC transfer tax is typically 1%
- Broker's commission is typically 6%
- Flip tax is typically 2% for co-ops and condos
- Total closing costs for the seller equal 10% of the purchase price.
- Additional seller closing costs include capital gains tax (9% of the gain for out-of-state sellers), tax liens (if any), and filing fees.
Loan Fee
- A safe assumption for loan fees is 0.5-1% of the loan amount.
Co-op Apartments
- Co-op apartments do not pay real estate taxes directly.
HUD Statement
- The HUD Statement is submitted when a loan is part of the real estate transaction.
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Description
Explanation of real estate titles, marketable titles, title searches, and chain of titles. Focus on abstract of title, title insurance, and closing statements. Also covers purchaser's closing costs.
