A buyer reviews an Illinois residential closing statement and asks how charges should be displayed. Which statement accurately describes the customary presentation?
Correct Answer
D) Each charge — such as loan payoff, transfer taxes, recording fees, and prorations — is listed as a separate line item.
Illinois closing practice, consistent with RESPA requirements for federally related loans and standard industry settlement procedures, requires that each cost component be disclosed separately. This allows buyers and sellers to verify exactly what they are being charged for — including real estate tax prorations, deed transfer taxes, recording fees, and mortgage payoffs — rather than receiving an unexplained total.
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Related Topics & Key Terms
Key Terms:
Related Concepts
The secondary mortgage market is where existing mortgage loans are bought and sold between lenders, investors, and government-sponsored enterprises (GSEs) like Fannie Mae, Freddie Mac, and Ginnie Mae.
TILA is a federal law that requires lenders to disclose the true cost of credit to borrowers, including the annual percentage rate (APR), total finance charges, and loan terms. It is implemented by Regulation Z.
A trustee sale is a type of foreclosure where a trustee, appointed under a deed of trust, sells the property at auction to satisfy the debt.
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