When buying a property, what must you repay the seller if they have already paid them?

When buying a property, what must you repay the seller if they have already paid them?

• A. Utility bills
• B. Property or school taxes
• C. Home insurance
• D. Mortgage payments

Answer: (B)

When purchasing a property, if the seller has already made payments for property or school taxes for the year, you are typically required to reimburse them for those costs up to the closing date. This reimbursement occurs because taxes are often paid annually or semi-annually in advance, and the seller is entitled to be compensated for the portion that covers the time you will own the property. During the property closing process, expenses related to taxes are prorated between the buyer and seller, so that the seller does not incur costs for a period after the sale while still covered by their previous payments. This ensures a fair distribution of costs according to the ownership timeline. Utility bills, home insurance, and mortgage payments do not follow the same reimbursement protocol during the closing process, as they are ongoing responsibilities that generally fall on the buyer after the sale is finalized or are the responsibility of the seller until the transaction is completed.

When purchasing a property, if the seller has already made payments for property or school taxes for the year, you are typically required to reimburse them for those costs up to the closing date. This reimbursement occurs because taxes are often paid annually or semi-annually in advance, and the seller is entitled to be compensated for the portion that covers the time you will own the property.

During the property closing process, expenses related to taxes are prorated between the buyer and seller, so that the seller does not incur costs for a period after the sale while still covered by their previous payments. This ensures a fair distribution of costs according to the ownership timeline.

Utility bills, home insurance, and mortgage payments do not follow the same reimbursement protocol during the closing process, as they are ongoing responsibilities that generally fall on the buyer after the sale is finalized or are the responsibility of the seller until the transaction is completed.