A Tampa Bay condominium sale is scheduled to close on March 10th. The monthly maintenance fee of $450 was paid by the seller for the entire month of March. According to Florida real estate practice, how should this prepaid maintenance fee be handled at closing?
Correct Answer
B) The seller receives a credit for the unused portion of March (21 days) based on daily proration
Correct: Prepaid expenses like maintenance fees are prorated at closing, with the seller receiving credit for the unused portion. Why not A: The buyer didn't pay for March, so they shouldn't receive the full credit. Why not C: Prepaid expenses must be prorated according to Florida closing procedures. Why not D: Proration must be based on actual days of ownership, not equal splits.
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Previous Question
A property in Miami closes on July 15th. The annual property taxes of $3,600 have been paid in full by the seller for the entire year. Using the 365-day method and assuming the seller owns the property on the day of closing, what is the tax proration credit due to the seller?
Next Question
A Jacksonville property closes on September 22nd. The homeowner's insurance premium of $1,200 runs from August 1st through July 31st of the following year. The buyer will assume the policy. Using a 30-day month method, what is the insurance proration amount and who receives the credit?