Question

Since the seller often has utilized the property for a portion of the year in which the transaction is being made, certain costs associated with the property will be prorated at the closing. All of the following items are subject to being prorated EXCEPT:_________.

A) Broker commission
B) Prepaid rent
C) Property tax
D) Mortgage interest

Answer 1

A) Broker commission

Step-by-step explanation:

-Broker commission is the amount of money that the broker charges for selling a property.

-Prepaid rent is an amount of money paid in advance when you move into a new house.

-Property tax are the taxes you have to pay when you have a real state.

-Mortgage interest in the interest you have to pay on a loan used to buy a property.

According to this, the answer is that all the items are subject to being prorated except broker comission because this is amount you have to pay to the broker for the job done and it is not a cost associated to the property and because of that it can't be prorated.

The other options are not right because those are costs that are associated to the property and because of that, they are prorated at the closing as the ownership is passed to someone else and that person would be responsible for the costs from that point.