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Real estate glossaryNational exam concept

Buyer funds needed at closing

Buyer funds needed at closing are the buyer's purchase-price obligation plus buyer closing costs and debits, minus loan proceeds, deposits already paid, seller credits, and other credits shown in the problem.

Exam area: Real Estate Calculations

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What does “buyer funds needed at closing” mean in real estate?

Buyer funds needed at closing are the buyer's purchase-price obligation plus buyer closing costs and debits, minus loan proceeds, deposits already paid, seller credits, and other credits shown in the problem.

How is “buyer funds needed at closing” different from the closest wrong answer?

The down payment is only the price not financed. Cash to close also includes costs, prorations, credits, and prior deposits.

What is the Georgia-specific rule?

Georgia problems can add intangible recording tax or attorney-related charges when allocated to the buyer. Apply the stated contract and closing figures, not a customary assumption.

Worked exam example

Scenario

Price is $350,000, loan is $280,000, buyer costs are $8,000, earnest money already paid is $5,000, and seller credit is $3,000. Funds needed are $70,000 + $8,000 - $5,000 - $3,000 = $70,000.

What is the most common exam trap?

Trap correction

Subtracting earnest money twice or forgetting that a credit reduces cash to close produces common distractors.

Original exam check

Apply the definition

A buyer purchases a home for $300,000 with a 90 percent loan. Buyer closing costs are $7,500, $4,000 in earnest money was paid at contract, and the seller gives a $2,500 credit. How much must the buyer bring to closing?

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