Term
| If an owner's annual property taxes on a $100,000 home are $540 and the house is assessed at 20% of value, what is the tax rate per thousand dollars of evaluation? |
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Definition
STEP 1: Assessed value=20% of $100,000=$20,000
STEP 2: $20,000 X tax rate=$540
Tax rate=$540/$20,000=0.027 per dollar=$27 per
thousand dollars
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Term
| If a home is valued at $100,000 and was assessed at 80% of its value, how much would the property taxes be at a rate of $18.20 per thousand dollars of assessed value? |
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Definition
STEP 1: Assessed value=80% X $100,000=$80,000
STEP 2: $80,000 X 0.01820=$1456.00 |
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Term
| A property is assessed at $100,000. With a tax rate of $2.50 per hundred, what will the taxes be? |
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Definition
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Term
| A home with a cost basis of $20,000 in 1975 is resold today for $90,000. Commissions and closing expenses are $6,000. What is the gain on the sale? |
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Definition
| $90,000-$6,000-$20,000=$64,000 |
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Term
| A property with a cost basis of $40,800 in 1985 is resold today for $60,000. Commission and closing expenses are $5,000. What is the adjusted sales price? |
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Definition
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Term
| A seller recieved $18,000 at the close of escrow after paying $1750 in closing costs and a 6% brokerage fee. What was the sales price of the house? |
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Definition
$18,000=sales price - $1,750 - 6% of sales price
$18,000=94% of sales price - $1,750
$19,750=94% of sales price
Sales price=$19,750/0.94=$21,010
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Term
| For what price must a house sell if the seller is to net $30,000 after paying $1,500 in settlement and the broker's commission of 6%? |
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Definition
- $30,000=sales price - (0.6 X sales price) - $1,500
- $31,500=0.94 X sales price
- $31,500/0.94=$33,510
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Term
| A seller has agreed to pay 80% of the title insurance company's fee on a sale. The company charges $550 for the title policy plus $95.50 for title search and $50 for processing the papers. What is the difference between what the seller has to pay and what the buyer has to pay to the title insurance company's fee? |
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Definition
- Seller pays 80% of $550+$95.50+$50=$556.40
- Buyer pays 20% of $550+$95.50+$50=$139.10
- The difference is $556.40-$139.10=$417.30
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Term
| A seller received a net amount of $29,817 after paying off a $53,000 loan balance, $1,213 in miscellaneous costs, and a 7% brokerage fee. What was the sales price of the house? |
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Definition
- Sales price-$53,000-$1,213-(0.07 X sales price)=$29,817
- 0.93 X sales price=$84,030
- Sales price=$84,030/0.93
- Sales price=$90,354.84
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Term
| A buyer agreed to put down $5,000 as earnest money toward a house he was buying for $97,000. The offer was based upon receipt of an 80% loan from a bank. The buyer's attorney's fees were $2,000 and all other buyer costs totaled $1,500. How much money will the buyer need to pay at settlement? |
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Definition
Loan amount is $77,600 (80% of $97,000)
Therefore buyer needs to pay:
$97,000-$5,000+$2,000+$1,500-$77,600=$17,900 |
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Term
| John bought a home for $75,000. He put up $5,000 earnest money and secured an 80% loan. The bank charged four points and a 2.5% loan fee. John received a $900 credit from the proration of taxes. How much cash will he need to bring to close this transaction? |
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Definition
Loan amount is $60,000 (80% of $75,000)
Bank fees are 4% plus 2.5% of $60,000=$3,900
Therefore John needs to bring:
$75,000-$5,000+$3,900-$900-$60,000=$13,000 |
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Term
| The property tax year runs from January 1 through December 31. The taxes on a certain house are $600 this year and have not yet been paid. If the house sells and the closing date is November 10, the _____ owes the ___ $______? |
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Definition
The SELLER owes the BUYER:
($600/365) X 314=$516.16 |
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Term
| A home was sold on June 12. The next payment date is July 1. The buyer agreed to assume the seller's 7% loan which has a balance of $100,000 as of June 1. Interest on this loan would be prorated as debit _____ and credit ____ $_____. |
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Definition
Debit Seller and Credit Buyer the following amount (because interest is paid in arrears):
[($100,000 X 0.07)/365] X 12=$230.14 |
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Term
| The proration of prepaid condominium association dues will result in a ____ to the seller and a _____ to the buyer. |
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Definition
| credit to the seller and a charge to the buyer. |
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Term
Property taxes/taxes and liens
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Definition
| Property taxes are a lien until paid. Taxes become a lien in advance. |
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Term
| When do tax liens have to be recorded to have priority? |
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Definition
| Tax liens have priority no matter when recorded. |
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Term
| When a homeowner feels his property has been assessed too high and files an appeal, the burden of proof is on _____. |
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Definition
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