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Which of these items would not need to be prorated on the day of closing?

a) Property taxes
b) Homeowner association fees
c) Mortgage interest
d) Home insurance premium

1 Answer

2 votes

Final answer:

Property taxes would not need to be prorated on the day of closing.

Step-by-step explanation:

To determine which item would not need to be prorated on the day of closing, we need to understand what proration means in this context. Proration is the division or allocation of costs between the buyer and seller based on the amount of time each party owns the property. Property taxes, homeowner association fees, mortgage interest, and home insurance premiums are all common expenses that are prorated at closing.

However, the item that would not need to be prorated on the day of closing is property taxes.

Property taxes are typically paid in arrears, meaning they are paid after the period for which they are due.

The seller would have already paid the property taxes for the period during which they owned the property, and the buyer will be responsible for paying the property taxes for the period after the closing date.

answered
User Corysimmons
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