UNIT 8: ESCROW AND CLOSING (QUIZ)
QUESTIONS AND ANSWERS
Escrow instructions must be: - Correct Answers -executed. One of the meanings of the
term execute is to sign. An escrow is officially open when both buyer and seller have
signed the instructions and delivered them to escrow. [Escrow]
The reason for using an escrow when a deed of trust is conveyed is to: - Correct
Answers -ensure that the conditions and instructions of the agreement are satisfied.
Escrow is not required. However, escrow, acting as a neutral third party helps to
guarantee that all terms and conditions of the agreement are met. [Escrow]
Which of the following best describes completed escrow? - Correct Answers -All escrow
instructions have been carried out. A perfect escrow is one for which all documents,
funds, and instructions required to close escrow are completed and are in the hands of
the escrow agent. A completed escrow is one in which all of the instructions have been
satisfied. When an escrow is both perfect and complete, it is ready to close. Escrow is
considered closed when the agent presents settlement statements to the buyer and
seller, disburses escrow funds, and delivers all necessary documents. [Escrow]
Which of the following statements concerning escrow is correct? - Correct Answers -In
order for the escrow to be able to close, the buyer may be required to pay more than the
amount stated in the escrow instructions. Closing costs are generally not included in
escrow instructions. They are calculated just prior to closing and are included in the
closing statement. [Escrow]
How would a loan for the purchase of a residence appear on the buyer's closing
statement? - Correct Answers -Credit to buyer. Whenever a buyer has a loan (new or
assumed) it is shown as a credit on the settlement statement. [Escrow]
Which of the following is regarded as a recurring cost in a closing statement? - Correct
Answers -Impound accounts. An impound account is a trust account set up for funds set
aside for future, recurring costs relating to a property. It is used as needed. [Escrow]
A buyer who wishes to insure title to real property when it is purchased should secure
a(n): - Correct Answers -title insurance policy. Title insurance insures and protects title
to property. [Assuring Marketability of Title]
Which of the following statements regarding escrow procedures is correct? - Correct
Answers -When the escrow requirements have been met, the escrow agency changes
from being agent of both parties to an agent of each party. During escrow, the escrow
officer is a neutral third party who acts as an agent for both parties. At the close of
escrow, the escrow officer becomes a single agent for each party. A broker may only
QUESTIONS AND ANSWERS
Escrow instructions must be: - Correct Answers -executed. One of the meanings of the
term execute is to sign. An escrow is officially open when both buyer and seller have
signed the instructions and delivered them to escrow. [Escrow]
The reason for using an escrow when a deed of trust is conveyed is to: - Correct
Answers -ensure that the conditions and instructions of the agreement are satisfied.
Escrow is not required. However, escrow, acting as a neutral third party helps to
guarantee that all terms and conditions of the agreement are met. [Escrow]
Which of the following best describes completed escrow? - Correct Answers -All escrow
instructions have been carried out. A perfect escrow is one for which all documents,
funds, and instructions required to close escrow are completed and are in the hands of
the escrow agent. A completed escrow is one in which all of the instructions have been
satisfied. When an escrow is both perfect and complete, it is ready to close. Escrow is
considered closed when the agent presents settlement statements to the buyer and
seller, disburses escrow funds, and delivers all necessary documents. [Escrow]
Which of the following statements concerning escrow is correct? - Correct Answers -In
order for the escrow to be able to close, the buyer may be required to pay more than the
amount stated in the escrow instructions. Closing costs are generally not included in
escrow instructions. They are calculated just prior to closing and are included in the
closing statement. [Escrow]
How would a loan for the purchase of a residence appear on the buyer's closing
statement? - Correct Answers -Credit to buyer. Whenever a buyer has a loan (new or
assumed) it is shown as a credit on the settlement statement. [Escrow]
Which of the following is regarded as a recurring cost in a closing statement? - Correct
Answers -Impound accounts. An impound account is a trust account set up for funds set
aside for future, recurring costs relating to a property. It is used as needed. [Escrow]
A buyer who wishes to insure title to real property when it is purchased should secure
a(n): - Correct Answers -title insurance policy. Title insurance insures and protects title
to property. [Assuring Marketability of Title]
Which of the following statements regarding escrow procedures is correct? - Correct
Answers -When the escrow requirements have been met, the escrow agency changes
from being agent of both parties to an agent of each party. During escrow, the escrow
officer is a neutral third party who acts as an agent for both parties. At the close of
escrow, the escrow officer becomes a single agent for each party. A broker may only
