Real estate finance 6

student_closing_disclosure.docx

Home >Business & Finance homework help >Financial markets homework help >Real estate finance 6

Closing Disclosure: This form is a statement of final loan terms and closing costs. Compare this document with your loan estimate.

Closing Information:

Date Issued: 4/15/2013

Closing Date: 4/15/2013

Disbursement Date: 4/15/2013

Settlement Agent: Epsilon Title Co.

File # 12-3456

Property: 456 Somewhere Ave.

Anytown, ST 12345

Sales Price: $180,000

Transaction Information:

Borrower: Michael Jones and Mary Stone

123 Anywhere St.

Anytown, ST 12345

Seller: Steve Cole and Amy Doe

321 Somewhere Dr.

Anytown, ST 12345

Lender: Ficus Bank

Loan Information:

Loan Term: 30 years

Purpose: Purchase

Product: Fixed Rate

Loan Type: Conventional X FHA VA

Loan ID# 123456789

MIC# 000654321

Loan Terms:

Loan Amount: $162,000 Can this amount increase after closing? NO

Interest Rate: 3.875% Can this amount increase after closing? NO

Monthly Principal & Interest: $761.78 Can this amount increase after closing? NO

Prepayment Penalty: Does this loan have these features? YES, as high as $3240 if you pay off the loan during the first two years.

Balloon Payment: No

Projected Payments

Payment Calculation:

Principal & Interest in years 1–7: $761.78; In years 8–30: $761.78

Mortgage insurance in years 1–7: + 82.35; In years 8–30: none

Estimated Escrow in years 1–7: $206.13; In years 8–30: $206.13

Estimated Total Monthly Payment in years 1–7: $1050.26; In years 8–30: $967.91

Estimated Taxes, Insurance & Assessments: $356.13 a month

This estimate includes:

X Property Taxes; In escrow? YES

X Homeowner’s Insurance; In escrow? YES

X Other Homeowner’s Association Dues; In escrow NO

Costs at Closing:

Closing Costs: $9,712.10 Includes $4,694.05 in Loan Costs + $5,018.05 in Other Costs-$0 in Lender Credits.

Cash to Close: $14,147.26 Includes Closing Costs.

CLOSING DISCLOSURE

LOAN COSTS	Borrower-Paid	Seller-Paid	Paid by Others
A. Origination Charges	$1,802.00	blank	blank
0.25% of Loan Amount (Points)	At closing: $1,000.00	blank	blank
Application Fee	$300.00	blank	blank
Underwriting Fee	$1, 097.00	blank	blank
B. Services Borrower Did Not Shop For	$236.55	blank	blank
Appraisal Fee: to John Smith Appraisers Inc.	blank	blank	$405.00
Credit report Fee: to Information Inc.	Before closing: $29.80	blank	blank
Flood Determination Fee: to Info Co.	At closing: $20.00	blank	blank
Flood Monitoring Fee: to Info Co.	At closing: $31.75	blank	blank
Tax Monitoring Fee: to Info Co.	At closing: $75.00	blank	blank
Tax Status Research Fee: to Info Co.	At closing: $80.00	blank	blank
C. Services Borrower Did Shop For	$2,655.50	blank	blank
Pest Inspection Fee: to Pests Inc.	At closing: $120.50	blank	blank
Survey Fee: to Surveys Inc.	At closing: $85,00	blank	blank
Title - Insurance Binder: to Epps Title Co.	At closing: $650.00	blank	blank
Title - Lender’s Title Insurance: to Epps Title Co.	At closing: $500.00	blank	blank
Title – Settlement Agent Fee: to Epps Title Co.	At closing: $500.00	blank	blank
Title – Title Search: to Epps Title Co.	At closing: $800.00	blank	blank
D. TOTAL LOAN COSTS (Borrower Paid)	$4,694.05	blank	blank
Loan Costs Subtotals (A+B+C)	At closing: $4,664.25 Before closing: $29.80	blank	blank
OTHER COSTS		blank	blank
E. Taxes and Other Government Fees	$85.00	blank	blank
Recording Fees: Deed: $40.00 Mortgage: $45.00	At closing: $85.00	blank	blank
Transfer Tax: to any State	blank	At closing: $950.00	Blank
F. Prepaids	$2,120.80	blank	blank
Homeowner’s Insurance premium (12 mo.) to Insurance Co.	At closing: $1,209.96	blank	blank
Mortgage insurance premium (? Mo.)	blank	blank	blank
Prepaid Interest ($17.44 per day from 4/15/13 to 5/1/13)	At closing: $479.25	blank	blank
Property Taxes (6 mo.) to Any County USA	At closing: $631.80	blank	blank
G. Initial Escrow Payment at Closing	$412.25
Homeowner’s Insurance $100.83 per month for 2 mo.	At closing: $201.66	blank	blank
Mortgage Insurance Premium ( mo.)	blank	blank	blank
Property Taxes $105.30 per month for 2 mo.	At closing: $315.90	blank	blank
Aggregate Adjustment	At closing: -0.01	blank	blank
H. Other	$2,400.00	blank	blank
HOA Capital Contribution: to HOA Acre Inc.	At closing: $500.00	blank	blank
HOA Processing Fee: to HOA Acre Inc.	At closing: $150.00	blank	blank
Home Inspection Fee: to Engineers Inc.	At closing: $750.00	blank	Before closing: $750
Home Warranty Fee: to XYZ Warranty Inc.	blank	$450.00	blank
Real Estate Commission: to Alpha Real Estate Broker	blank	$5,700.00	blank
Real Estate Commission: to Omega Real Estate Broker	blank	At closing: $5,700.00	blank
Title – Owner’s Title Insurance (optional): to Epps Title Co.	At closing: $1,000	blank	blank
I. TOTAL OTHER COSTS (borrower-Paid)	$5,018.05	blank	blank
Other Costs Subtotals (E +F+G+H)	At closing: $5,018.05	blank	blank
J. TOTAL LOSING COSTS (Borrower-Paid)	$9,712.10	blank	blank
Closing Costs Subtotals (D + I)	At closing: $9,682.30; Before Closing: $29.80	At closing: $12,800.00; Before closing: $750.00	$405.00
Lender Credits	blank	blank	blank

Calculating Cash to Close: Use this table to see what has changed from your Loan Estimate.

Cash to Close	Loan Estimate	Final	Did this change?
Total Closing Costs (J)	$8,054.00	$9,712.10	Yes: See Total Loan Costs (D) and Total Other Costs (I)
Closing Costs Paid Before Closing	$0	-$29.80	Yes: You paid these Closing Costs before closing
Closing Costs Financed (Paid from your Loan Amount)	$0	$0	No
Down Payment/Funds from Borrower	$18,000.00	$18,000.00	No
Deposit	-$10,000.00	-$10,000.00	No
Funds for Borrower	$0	$0	No
Seller Credits	$0	-$2,500.00	Yes: See Seller Credits in Section L
Adjustments and Other Credits	$0	$1,035.04	Yes: See details in Sections K and L
CASH to Close	$16,054.00	$14,147.26	blank

Summaries of Transactions: Use this table to see a summary of your transaction.

Borrower’s Transaction	Seller’s Transaction
K. Due from Borrower at Closing: $189,762.30	M. Due to Seller at Closing:-------- $180,080.00
Sale Price of Property: -------------------$180,000.00	Sale Price of Property:-------------------$180,000.00
Sale Price of Any Personal Property Included in Sale: blank	Sale Price of Any Personal Property Included in the Sale: blank
Closing Costs Paid at Closing (J):-------- $9,682.30
Adjustments
Adjustments for Items Paid by Seller in Advance:	Adjustments for Items Paid by Seller in Advance:
City/Town Taxes: blank to blank	City/Town Taxes: blank to blank
County Taxes: blank to blank	County Taxes: blank to blank
Assessments blank to blank	Assessments blank to blank
HOA Dues 4/15/13 to 4/30/13:-------------$80.00	HOA Dues 4/15/13 to 4/30/13: ---------------$80.00
L. Paid Already by or on Behalf of Borrower at Closing:----------------------------- $175,615.04	N. Due from Seller at Closing: $115,665.04
Deposit:----------------------------------- $10,000.00	Excess Deposit:
Loan Amount:-------------------------- $162,000.00	Closing Costs Paid at Closing (J): $12,800.00
Existing Loan(s) Assumed or Taken Subject to: blank	Existing Loan(s) Assumed or Taken Subject to: blank
blank	Payoff of First Mortgage Loan:-------- $100,000.00
Seller Credit:------------------------------- $2,500.00	Payoff of Second Mortgage Loan: blank
Other Credits:	blank
Rebate from Epps Title Co. ---------------$750.00	blank
Adjustments: blank	blank
Adjustments for items Unpaid by Seller	Adjustments for items Unpaid by Seller
City/Town Taxes: 1/2/13 to 4/14/13:----$365.04	City/Town Taxes: 1/2/13 to 4/14/13:------- $365.04
County Taxes: blank to blank	County Taxes: blank to blank
Assessments: blank to blank	Assessments: blank to blank
CALCULATION	CALCULATION
Total Due from Borrower at Closing (K): --------- -------------------------------------------- $189,762.30	Total Due to Seller at Closing (M):--- $180,080.00
Total Paid Already by or on Behalf of Borrower at Closing (L):----------------------- $175,615.04	Total Due from Seller at Closing (N):--------------------------- $115,665.04
Cash to Close: X From Borrower: --------------------$14,147.26 To Borrower: blank	Cash: From Seller X To Seller: ---------------------------------$64,414.96

ADDITIONAL information About This Loan

Loan Disclosures:

Assumption

If you sell or transfer this property to another person, your lender

Not Selected will allow, under certain conditions, this person to assume this loan on the original terms.

X will not allow assumption of this loan on the original terms.

Demand Feature

Your loan

Not Selected has a demand feature, which permits your lender to require early repayment of the loan. You should review your note for details.

X does not have a demand feature.

Late Payment

If your payment is more than 15 days late, your lender will charge a late fee of 5% of the monthly principal and interest payment.

Negative Amortization (Increase in Loan Amount)

Under your loan terms, you

Not Selected are scheduled to make monthly payments that do not pay all of the interest due that month. As a result, your loan amount will increase (negatively amortize), and your loan amount will likely become larger than your original loan amount. Increases in your loan amount lower the equity you have in this property.

Not Selected may have monthly payments that do not pay all of the interest due that month. If you do, your loan amount will increase (negatively amortize), and, as a result, your loan amount may

become larger than your original loan amount. Increases in your loan amount lower the equity you have in this property.

X do not have a negative amortization feature.

Partial Payments

Your lender

X may accept payments that are less than the full amount due (partial payments) and apply them to your loan.

Not Selected may hold them in a separate account until you pay the rest of the payment, and then apply the full payment to your loan.

Not selected does not accept any partial payments.

If this loan is sold, your new lender may have a different policy.

Security Interest

You are granting a security interest in 456 Somewhere Ave., Anytown, ST 12345

You may lose this property if you do not make your payments or satisfy other obligations for this loan.

Loan Calculations

Loan Calculations Items:	Amount:
Total of Payments. Total you will have paid after you make all payments of principal, interest, mortgage insurance, and loan costs, as scheduled.	$285,803.36
Finance Charge. The dollar amount the loan will cost you.	$118,830.27
Amount Financed. The loan amount available after paying your upfront finance charge.	$162,000.00
Annual Percentage Rate (APR). Your costs over the loan term expressed as a rate. This is not your interest rate.	4.174%
Total Interest Percentage (TIP). The total amount of interest that you will pay over the loan term as a percentage of your loan amount.	69.46%

Other Disclosures:

Appraisal

If the property was appraised for your loan, your lender is required to give you a copy at no additional cost at least 3 days before closing.

If you have not yet received it, please contact your lender at the information listed below.

Contract Details

See your note and security instrument for information about

• what happens if you fail to make your payments,

• what is a default on the loan,

• situations in which your lender can require early repayment of the loan, and

• the rules for making payments before they are due.

Liability after Foreclosure

If your lender forecloses on this property and the foreclosure does not cover the amount of unpaid balance on this loan,

X state law may protect you from liability for the unpaid balance. If you refinance or take on any additional debt on this property, you may lose this protection and have to pay any debt remaining even after foreclosure. You may want to consult a lawyer for more information.

Not Selected state law does not protect you from liability for the unpaid balance.

Refinance

Refinancing this loan will depend on your future financial situation, the property value, and market conditions. You may not be able to refinance this loan.

Tax Deductions

If you borrow more than this property is worth, the interest on the loan amount above this property’s fair market value is not deductible from your federal income taxes. You should consult a tax advisor for more information.