Where this fits on the exam
| Official syllabus topic | Finance and Closing: Finance; Closing Procedures |
|---|---|
| Official PSI group | Finance and Closing |
| Published group count | 15 of the 52 Georgia questions |
| Exam portion | Georgia salesperson supplement |
| Source edition | PSI Georgia Candidate Information Bulletin dated July 1, 2026 |
The Rule
PSI publishes 16, 21, and 15 items for the three Georgia groups. It does not publish a guaranteed subtopic count. The statute, current GREC rule, contract, or other cited primary authority controls each lesson.
The lesson
Finance chain
Borrower signs the note, grants the security deed, satisfies lender conditions, and pays loan-related charges while the lender authorizes funding.
Title chain
The attorney examines title, obtains cures and payoffs, prepares or adopts legal documents, conducts closing, and coordinates recording.
Money chain
Deposits, loan proceeds, buyer funds, seller proceeds, taxes, costs, payoffs, and prorations must balance in the settlement statement.
Tax chain
Transfer tax follows taxable consideration and the deed transaction. Intangible recording tax follows the face amount of the qualifying long-term note secured by Georgia real estate.
Decision rule
Georgia rule and national contrast
Worked Georgia example
Scenario. A home sells for $400,000 with a $320,000 long-term note secured by Georgia real estate. The seller has an existing loan payoff and prepaid property taxes.
Reason it through. Use taxable consideration for transfer tax and $320,000 for intangible recording tax. Debit the seller for the payoff. Prorate prepaid taxes as a buyer debit and seller credit for the buyer's ownership period. The attorney conducts closing and coordinates recording.
Answer. Keep each base and settlement entry separate; do not calculate both taxes from $400,000 or treat the payoff as a buyer charge.
Common exam traps
- Using one base for both taxes
- Calling the security deed the debt
- Reversing prepaid-tax entries
- Treating signing as completed recordation
Original practice questions with detailed explanations
These are original instructional questions mapped to the July 1, 2026 PSI outline. They are not copied from PSI or a live examination. Choose an answer before opening the explanation.
Question 1A Georgia home sells for $400,000. The buyer signs a 30-year note for $320,000 secured by the property, and no existing lien stays in place. Transfer tax is $1 per $1,000 of consideration, and intangible recording tax is $1.50 per $500 of the note. What are the two taxes?
- A. Transfer tax $400; intangible tax $1,200
- B. Transfer tax $400; intangible tax $960
- C. Transfer tax $320; intangible tax $960
- D. Transfer tax $400; intangible tax $480
Show answer and explanation →
Answer: B. Transfer tax $400; intangible tax $960
Transfer tax uses the consideration: $400,000 ÷ 1,000 × $1 = $400. Intangible recording tax uses the long-term note: $320,000 ÷ 500 × $1.50 = $960. Choosing $1,200 means the intangible tax was figured on the sale price, which is the one-base trap.
- A. Incorrect. $1,200 applies intangible tax to the $400,000 sale price rather than the $320,000 note.
- B. Correct. Transfer tax is $400 on consideration; intangible tax is 640 note units times $1.50, or $960.
- C. Incorrect. $320 incorrectly uses the note amount for transfer tax, though the intangible result is correct.
- D. Incorrect. $480 uses $1,000 note units instead of the required $500 units for intangible tax.
Question 2At closing, the seller's existing $150,000 loan is paid off from the sale. How does the payoff appear on the settlement statement?
- A. A debit to the buyer, because the buyer's funds pay it
- B. A credit to the seller, because it clears the seller's debt
- C. A credit to the buyer, because the buyer gets clear title
- D. A debit to the seller, because it cuts the seller's proceeds
Show answer and explanation →
Answer: D. A debit to the seller, because it cuts the seller's proceeds
The payoff is the seller's debt, so it is charged against the seller's proceeds as a seller debit. It has no entry on the buyer's side. Candidates who pick the buyer debit are following the cash instead of asking whose obligation the payoff satisfies.
- A. Incorrect. The cash source does not change whose debt is being paid; the payoff is the seller's charge.
- B. Incorrect. A credit increases proceeds, while this payoff reduces the seller's proceeds.
- C. Incorrect. Clear title is not a buyer cash credit equal to the seller's debt.
- D. Correct. The seller's existing debt is subtracted from the seller's proceeds as a debit.
Question 3The parties sign every document on Friday, the lender funds on Monday, and the attorney records the deed on Tuesday. From which event do later buyers and lenders have constructive notice of the new owner's deed?
- A. Tuesday's recording in the county records
- B. Friday's signing at the attorney's office
- C. Monday's funding of the loan by the lender
- D. The later issuance of the owner's title policy
Show answer and explanation →
Answer: A. Tuesday's recording in the county records
Constructive notice comes from recording in the proper county's real-property records. Signing, funding, and recording are separate moments in the closing chain, and only recording puts the public on notice. Funding looks plausible because moving money feels final, but funding is not recordation.
- A. Correct. Proper county recording gives constructive notice of the deed on Tuesday.
- B. Incorrect. Signing does not publish the deed in the real property records.
- C. Incorrect. Loan funding is separate from the act that creates public record notice.
- D. Incorrect. A title policy insures a defined interest and does not itself record the deed.
Ready to move on?
You are ready for the next lesson when all of these are true.
- Follow a transaction from note and security deed through funding and recording.
- Classify closing entries as buyer or seller debits and credits.
- Choose the deed's taxable consideration for transfer tax and the note amount for intangible tax.
- Answer the practice questions without looking back, then explain why the other choices fail.
- Explain the worked example in your own words and identify the fact that decides the answer.
- Retest this topic on another day in a mixed question set.
Recommended next lesson
Continue with Mixed Georgia supplement practice. Mixed practice puts finance, closing, and license-law questions side by side, so work a set and reopen the lesson behind each miss, starting with the two-tax and settlement-entry chains from this workshop.
Return to the Finance and Closing hub for the complete official branch and the full lesson list for this Georgia group.