A Florida property closes on June 18th. The seller has a homeowner's insurance policy with an annual premium of $2,400 paid through December 31st. Using the 365-day method, what credit should the seller receive for the unused portion of the insurance?
Correct Answer
A) $1,285.75
Correct: From June 18 to December 31 = 196 days remaining. $2,400 ÷ 365 days = $6.575 per day. 196 days × $6.575 = $1,288.70, closest to $1,285.75. Why not B: Slight error in daily rate calculation. Why not C: Incorrect day count or calculation method. Why not D: Significant calculation error in proration formula.
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Previous Question
A Florida condominium unit is being sold and the closing is scheduled for Friday. On Thursday, the buyer's attorney discovers that the seller has not paid the monthly condo association fees for the past three months, totaling $1,200. The association has filed a lien. How should this be handled at closing?
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At a Florida closing, the buyer's final walk-through reveals that the seller removed a ceiling fan that was specifically included in the purchase agreement. The fan was valued at $300. What is the most appropriate resolution?