Transfer of Title topic guide
Closing, recordation, and warranties
A closing is a chain of decisions, documents and payments. A signature, wire receipt or recorder’s stamp answers only part of the problem. Follow what each event accomplishes, what remains unresolved and who has authority to handle it.
Last reviewed:
The short answer
Closing coordinates the contract, documents, funds and required approvals. For an ordinary deed, valid delivery with present intent and acceptance matter to an effective transfer; signing, notarizing, funding, taking possession and recording are separate events. Recording supplies legally significant notice and can affect priority, but does not create missing ownership or cure a forged instrument. The Closing Disclosure explains a covered loan’s terms and costs. Deed covenants, title policies, builder warranties, product warranties and paid home service contracts protect different interests.
National IX.C.1-4 in the June 24, 2026 PSI outline covers effective transfer, recordation, settlement procedures and parties, and home or new-construction warranties. Transfer of Title has 6 of 100 scored national broker questions as a whole, not six questions for this page. Illinois law governs Illinois conveyances; covered mortgage disclosures have separate federal requirements. Examples use stated assumptions. No practice score here is a validated readiness cutoff.
Follow the transaction and identify the unresolved step
- Start with the actual agreement, parties, property, contingencies, dates and possession terms. A familiar closing checklist cannot amend the contract.
- Match each document to its function: deed for conveyance, note for repayment, mortgage for security, and the applicable disclosure for credit terms and costs.
- Check capacity, authority, description, execution, delivery and acceptance. For an ordinary deed, physical handover is evidence, not the entire intent analysis; authorized escrow conditions matter.
- Identify the applicable disclosure rule, receipt date and consummation. Do not equate a purchase-contract signature with becoming obligated on the credit transaction.
- Reconcile the final money figures, payoffs, verified instructions, available funds and authorization to disburse. Do not count earnest money twice or assume sending money completes settlement.
- Check recording requirements and confirm the actual filing. Consider the specified third parties and notice rules rather than declaring that the first recorder always wins.
- Classify the protection being discussed. Read the named insured, covered interest or component, term, exclusions, claim process and any separate legal rights.
- Track recording, releases, policy issuance, possession and agreed post-closing work. Preserve the file and refer legal, title, tax, lending and coverage decisions to the qualified professional.
| Document or event | Main function | Common exam mistake |
|---|---|---|
| Deed | Conveys the stated ownership interest | Treating it as a loan document |
| Promissory note | States the borrower's repayment promise | Treating it as the lien on land |
| Mortgage | Secures the loan with real property | Treating it as the ownership conveyance |
| Closing Disclosure | States final covered loan terms and costs | Treating it as the deed |
| Title commitment | Offers future policy coverage subject to requirements | Treating it as the final policy |
| Recordation | Supplies filed public notice under applicable law; can affect priority | Treating it as proof that every element was valid |
| Builder warranty | Covers stated construction obligations | Assuming unlimited defect coverage |
| Home service contract | Provides specified repair services subject to coverage terms | Confusing it with property insurance |
The distinctions that matter
| Distinction | How it works | What to notice |
|---|---|---|
| Closing vs. recordation | Closing coordinates the applicable settlement obligations. Recordation files eligible instruments in public land records; it is not a universal legal prerequisite for an ordinary deed’s effectiveness between the parties. | Documents and funds versus public notice and priority. |
| Deed delivery vs. possession | Delivery concerns the grantor's present intent to make the deed effective. Possession concerns physical control or occupancy of the property. | Transfer of title versus keys or move-in date. |
| Actual notice vs. constructive notice | Actual knowledge and legally attributed notice are different. Illinois Section 30 identifies creditors and subsequent purchasers without notice; Section 31 separately addresses filed notice despite acknowledgment defects and preserves its execution-proof qualification. Do not assume the first filing always wins. | What the person knew versus what the public record legally supplies. |
| Deed vs. mortgage | The deed conveys the ownership interest. The mortgage or other security instrument gives the lender a security interest under its terms. | Ownership transfer versus loan collateral. |
| Closing Disclosure vs. deed | The Closing Disclosure states final covered loan terms and transaction costs. The deed is the conveyance instrument. | Loan and cost disclosure versus title transfer. |
| Title policy vs. deed warranty | A title policy is an insurance contract protecting a named insured against covered risks. A deed warranty is the grantor's covenant stated or implied by the deed form. | Insurer's covered risk versus grantor's title promise. |
| Builder warranty vs. home warranty | A builder warranty addresses stated construction obligations. A home warranty is usually an optional service contract for listed systems or appliances. | New construction promise versus purchased repair plan. |
| Home warranty vs. homeowners insurance | A service contract addresses listed breakdowns subject to its terms. Homeowners insurance addresses covered losses and liabilities under an insurance policy. | Repair plan versus insured casualty or liability risk. |
| Proration vs. payoff | A proration allocates a shared or periodic item between parties. A payoff satisfies a debt or lien according to the creditor's instructions. | Divide an expense or income versus extinguish an obligation. |
| Acknowledgment and delivery | A notarial acknowledgment is distinct from intent, delivery and acceptance. Illinois Section 35c expressly says failure to comply with its acknowledgment provision does not invalidate the instrument. This does not approve every document for recording. | The notary does not supply missing conveyance intent. |
| Credit consummation and possession | Consummation concerns when the consumer becomes bound on the credit transaction under applicable law. Move-in rights and deed delivery are separate questions. | A credit clock is not the key handover. |
| Payoff and recorded release | Paying the amount required to satisfy a debt and confirming a recorded lien release are related but different tasks. Obtain and verify the appropriate record rather than assuming a zero balance proves recording. | Payment evidence does not replace the land record. |
Work through the facts
The signed deed is still in the seller's desk
A seller signs and acknowledges a deed but keeps it in a desk, telling the buyer that the seller may change their mind before next week's closing.
- Signature and acknowledgment help make an instrument recordable, but they do not alone establish delivery with present intent.
- The seller's retained control and stated ability to revoke point away from an effective present delivery on these facts.
Answer: Do not treat the deed as effective merely because it is signed. Delivery, intent, the escrow arrangement, and applicable law must be evaluated.
A recorded deed contains the wrong parcel
The closing agent records a deed whose legal description identifies the seller's neighboring parcel instead of the property in the purchase agreement.
- The recorder's acceptance places the document in the public records but does not rewrite the legal description.
- The defect affects what land the instrument describes and requires prompt title and legal review.
Answer: Recordation does not cure the error. The parties need the title professional and attorneys to determine the proper correction, recording, and policy treatment.
Last-minute wiring instructions arrive by email
On closing morning, a buyer receives an email that appears to come from the settlement agent and directs the buyer to send funds to a different bank account.
- Real estate wire fraud often uses convincing messages and urgent changes.
- Payment instructions should be verified through a trusted, independently obtained contact method before any money moves.
Answer: The buyer should stop and verify the instructions directly with the known settlement contact. The broker should not forward or validate changed instructions casually.
A refrigerator failure is not a structural warranty claim
Six months after buying a newly constructed home, the refrigerator stops cooling. The buyer assumes the builder's structural warranty must pay for it.
- A structural or builder warranty covers only the items and periods stated in its terms.
- An appliance may instead fall under a manufacturer warranty or a separate service contract.
Answer: The buyer must identify the failed item and read the builder, manufacturer, and service-contract documents. The label 'new home warranty' does not create universal coverage.
Count the disclosure review period
Assume a covered ordinary transaction, in-person receipt on Thursday, October 22, 2026, no applicable exception or holiday, and all other requirements satisfied. What is the earliest consummation under this three-business-day waiting rule alone?
- Friday, October 23 is day one.
- Saturday, October 24 is day two; a closed lender office does not remove Saturday from this specific count.
- Sunday does not count. Monday, October 26 is day three.
- This is not a calculation of the mailing presumption, an entire loan timeline or private contractual authority.
Answer: Monday, October 26, under the stated assumptions and this rule alone.
A credit changes without a restart trigger
Assume a covered Closing Disclosure was timely received. A final walk-through produces a negotiated $700 seller credit. No inaccurate APR as legally defined, loan-product change or added prepayment penalty results.
- The changed credit needs the appropriate corrected disclosure.
- Under the stated no-trigger facts, the change alone does not start another three-business-day wait.
- Other lending, contract and settlement requirements still apply.
Answer: Correct the disclosure at or before consummation; do not impose an invented automatic restart for every change.
A prepayment penalty is added
Before consummation of a covered transaction, a new prepayment penalty makes the relevant disclosure inaccurate. No applicable exception is assumed.
- Adding the penalty is one of the specified restart events.
- The consumer must receive the corrected Closing Disclosure with the required renewed review period.
- Removing a penalty is not that same addition trigger, though a correction or another trigger can still matter.
Answer: Apply the renewed three-business-day receipt requirement rather than treating the correction as a routine same-day change.
Reconcile cash to close
Assume a $300,000 price, $240,000 loan applied to the price, $9,000 buyer costs and prepaid amounts, $6,000 earnest money already credited, and an authorized $3,000 seller credit fully applied to those costs. There are no other adjustments.
- The buyer’s price contribution is $300,000 - $240,000 = $60,000.
- Add $9,000, then subtract the already credited $6,000 and the applied $3,000 seller credit.
- The result is $60,000. Do not subtract earnest money twice or assume a seller credit is unrestricted cash back.
Answer: The stipulated additional cash is $60,000; verify the actual closing statement and permissible credit treatment.
A commitment is not the issued policy
A buyer receives a title commitment with an unreleased lien requirement and assumes it is already a final owner’s policy.
- Read the requirements, proposed coverage and exceptions.
- Confirm the actual policy, named insured and covered interest after the required work.
- A lender’s policy protects the lender’s insured interest; it is not automatically the buyer’s owner coverage.
Answer: Resolve and verify the required title work instead of promising automatic coverage from the commitment.
An optional plan is not every legal right
A paid service contract excludes the particular repair. The owner asks whether that exclusion proves no possible claim can exist against any party.
- The plan’s terms determine that plan’s coverage, subject to applicable law.
- The exclusion does not itself adjudicate separate contractual, statutory or other legal rights.
- Preserve notices and records and obtain qualified advice about the actual facts and applicable periods.
Answer: Do not promise plan coverage or declare every separate legal claim extinguished.
Seller net and buyer cash answer different questions
Assume a $300,000 sale price, $180,000 seller payoff and $12,000 seller-side costs or adjustments, with no other item.
- The simplified seller net is $300,000 - $180,000 - $12,000 = $108,000.
- The buyer’s separately calculated $60,000 additional cash uses a different ledger and does not equal these proceeds.
- Net proceeds are not automatically taxable gain, and the stated figures do not verify an actual payoff or return.
Answer: The stipulated seller net is $108,000. Reconcile each side’s actual statement separately.
Possession follows the actual agreement
Assume an otherwise effective ordinary conveyance and a separate valid written agreement giving the seller possession until Friday at 5 p.m. A buyer assumes earlier recording automatically changes that agreed handover.
- The example stipulates an effective conveyance rather than asking the broker to decide deed validity.
- Possession has a separate stated contractual term.
- Do not treat the filing timestamp as an automatic amendment or advise self-help entry; obtain appropriate advice if the actual agreement or performance is disputed.
Answer: Track the stipulated possession obligation separately from recording and title transfer.
Mistakes to avoid
- Ownership always transfers when everyone sits down at the closing table. Transfer depends on the deed, delivery, intent, acceptance, contract, funding, escrow conditions, and governing law.
- A deed is valid only after recording. Recording is crucial for notice and priority, but validity between the parties depends on execution, delivery, and other legal requirements.
- Recording proves the grantor had good title. The public record does not guarantee ownership, authority, accuracy, or freedom from defects.
- The Closing Disclosure transfers the home. It discloses final covered loan terms and costs. The deed is the conveyance instrument.
- Every mortgage borrower receives a Closing Disclosure. The form applies to most covered mortgage transactions, while specified products use other disclosures.
- A broker may decide whether a deed or warranty is legally enforceable. The broker identifies the issue and protects the process, then refers legal and coverage conclusions to qualified professionals.
- A home warranty is homeowners insurance. A home warranty is usually a service contract. Homeowners insurance is a separate policy covering stated risks.
- A builder warranty covers every problem in a new home. Coverage depends on the document's components, time periods, exclusions, notice rules, and remedies.
- Once funds are wired, closing is complete. Documents, funding authorization, disbursement, delivery, recording, and post-closing requirements may still remain.
- An email that looks familiar is enough to verify changed wire instructions. Independently confirm payment instructions using a trusted phone number or other established process before sending funds.
- Every Closing Disclosure correction restarts the waiting period. Distinguish a correction from the specified restart events: an APR that is inaccurate under the regulation, a changed loan product, or an added prepayment penalty.
- A home buyer always has three days after signing to cancel the purchase. The disclosure waiting period is not a universal purchase-cancellation right. Rescission has its own coverage and exceptions; a residential mortgage transaction has an express exemption.
- A document’s warranty term determines every legal deadline. Read that coverage and obtain qualified advice about separate rights, notice requirements and limitation periods. Do not convert typical coverage into universal law.
Check your understanding
These are original teaching questions, not recalled or predicted PSI questions. Answer first, then explain why the other choices fail.
1. What is the main legal effect of properly recording a deed in the county land records?
- It supplies public notice and can affect priority
- It always defeats an earlier interest even if the filer has actual notice
- It guarantees every title-policy exception has been removed
- It conclusively validates every earlier signature
Show answer and explanation
Answer: A. It supplies public notice and can affect priority
Recordation supports constructive notice and the public chain of title. It does not guarantee that the instrument was otherwise valid.
2. Which document states the final terms and costs for most covered consumer mortgage loans?
- Quitclaim deed
- Title policy endorsement
- Closing Disclosure
- Certificate of occupancy
Show answer and explanation
Answer: C. Closing Disclosure
The Closing Disclosure summarizes final covered loan terms, projected payments, and closing costs and is generally delivered at least three business days before consummation.
3. A signed deed remains under the grantor's exclusive control with instructions not to use it yet. Which issue should be examined first?
- Whether acknowledgment alone makes the deed irrevocable
- Whether a future recording automatically establishes earlier delivery
- Valid delivery and present intent
- Whether the buyer’s later possession supplies every missing element
Show answer and explanation
Answer: C. Valid delivery and present intent
A signature alone does not answer whether the deed was delivered with present intent to transfer the stated interest.
4. Which statement best distinguishes a builder warranty from a home warranty?
- A paid repair plan automatically replaces every legal right against a builder
- A structural warranty necessarily covers all household appliances
- A builder warranty addresses stated construction coverage, while a home warranty is usually a purchased service contract
- Every construction component has one universal coverage period
Show answer and explanation
Answer: C. A builder warranty addresses stated construction coverage, while a home warranty is usually a purchased service contract
The documents protect different interests. Coverage must be determined from their actual terms, limits, and exclusions.
5. A deed was recorded with an incorrect legal description. What is the best next step for the broker?
- Ignore it because recording cured the problem
- Promise the buyer that title insurance automatically covers it
- Draft a replacement deed without telling anyone
- Promptly notify the appropriate parties and refer the correction to the title professionals and attorneys
Show answer and explanation
Answer: D. Promptly notify the appropriate parties and refer the correction to the title professionals and attorneys
The broker should flag the issue and preserve the transaction record, while qualified title and legal professionals determine the correction and coverage.
6. In a covered ordinary transaction, which event starts the relevant Closing Disclosure review count?
- The consumer’s receipt under the applicable delivery rules
- Sending a draft without evidence of receipt
- The buyer’s first property viewing
- The seller’s move-out date
Show answer and explanation
Answer: A. The consumer’s receipt under the applicable delivery rules
Receipt and the applicable delivery rules matter. A sent email is not automatically proved same-day receipt or compliant electronic delivery.
7. Which days ordinarily count for this specific three-business-day Closing Disclosure period?
- Only weekdays when the lender is open
- Only the days the settlement agent chooses
- Every calendar day, including Sundays
- Calendar days except Sundays and the specified legal public holidays
Show answer and explanation
Answer: D. Calendar days except Sundays and the specified legal public holidays
This specific definition differs from the lender-open-for-business definition used for other purposes. A normal Saturday counts.
8. Assume in-person receipt Thursday, October 22, 2026, an ordinary covered transaction, no holidays or exception, and all other requirements met. What is the earliest consummation under this waiting rule alone?
- Friday, October 23
- Monday, October 26
- Saturday, October 24
- Sunday, October 25
Show answer and explanation
Answer: B. Monday, October 26
Friday is day one, Saturday day two, Sunday is excluded and Monday is day three. This does not determine every other contractual or loan requirement.
9. A covered Closing Disclosure changes before consummation. Which statement is correct?
- Every change automatically restarts three days
- No correction can be needed unless a new wait is required
- A correction is required as applicable; only the specified changes require a new waiting period
- A broker can waive every federal requirement
Show answer and explanation
Answer: C. A correction is required as applicable; only the specified changes require a new waiting period
Separate disclosure accuracy from timing. The defined APR-inaccuracy, loan-product and added-penalty triggers require renewed receipt timing, subject to applicable rules.
10. Which is one of the specified renewed-waiting-period triggers before consummation?
- Any spelling correction
- Any change in the price of furniture
- Adding a prepayment penalty so the relevant disclosure becomes inaccurate
- Removing a penalty with no other trigger
Show answer and explanation
Answer: C. Adding a prepayment penalty so the relevant disclosure becomes inaccurate
The specified trigger is addition of the penalty. Other corrections can still be required without automatically restarting the wait.
11. Does a lender’s title policy automatically provide the buyer’s owner coverage?
- Yes, because the buyer pays a closing cost
- Yes, because every policy covers every party
- No; check the named insured, covered interest and actual policy
- No title policy can protect any owner
Show answer and explanation
Answer: C. No; check the named insured, covered interest and actual policy
An owner’s policy and a lender’s policy protect different insured interests. A commitment is also distinct from the final issued policy.
12. A deed is acknowledged but remains revocable under the stated facts. What follows?
- Acknowledgment does not itself establish present delivery and acceptance
- Recording is no longer relevant
- The grantee must have paid cash
- The notary automatically completed delivery
Show answer and explanation
Answer: A. Acknowledgment does not itself establish present delivery and acceptance
Evaluate execution, actual intent and delivery facts separately. Section 35c also has an express noninvalidity provision; do not invent a universal acknowledgment-validity rule.
13. A later purchaser actually knows of an earlier unrecorded interest. May the broker declare that recording first always defeats it?
- Yes, first filing resolves every case
- No; notice, the parties and applicable priority rules must be evaluated
- Yes, because knowledge is never relevant
- No instrument may be recorded after another sale
Show answer and explanation
Answer: B. No; notice, the parties and applicable priority rules must be evaluated
Illinois Section 30 expressly addresses the specified creditors and subsequent purchasers without notice. Do not adjudicate private priority from a timestamp alone.
14. Which event is credit consummation under Regulation Z?
- The buyer first tours a home
- The consumer becomes contractually obligated on the credit transaction under applicable law
- The seller hands over keys
- A home service contract expires
Show answer and explanation
Answer: B. The consumer becomes contractually obligated on the credit transaction under applicable law
The credit obligation, sale contract, deed transfer and possession are different questions. State law determines when the credit obligation is formed.
15. A plan lists a twelve-month workmanship term. What may a broker safely conclude?
- Every Illinois legal claim expires at twelve months
- Read that component’s actual coverage and seek qualified advice about any separate rights or deadlines
- Every defect is covered for twelve months
- The owner has no notice duties
Show answer and explanation
Answer: B. Read that component’s actual coverage and seek qualified advice about any separate rights or deadlines
A document’s stated coverage is not a universal legal limitation period. No claim outcome, waiver or private deadline is determined here.
16. The lender delegates delivery of the Closing Disclosure to a settlement agent. What is correct?
- The creditor automatically loses every responsibility
- The broker may remove the required review period
- The creditor retains responsibility for compliance under the rule
- The borrower must receive two duplicate forms
Show answer and explanation
Answer: C. The creditor retains responsibility for compliance under the rule
Delegated delivery does not eliminate the creditor’s responsibility. Proper coordination matters; duplicative disclosures are not a compliance cure.
17. Assume a normal Saturday with no specified legal public holiday. Does it count in the specific Closing Disclosure three-business-day review period even if the lender’s office is closed?
- No, only bank-opening days count
- No, only the recorder’s working days count
- Yes, but Sundays always count too
- Yes, under this specific definition
Show answer and explanation
Answer: D. Yes, under this specific definition
This clock excludes Sundays and the specified legal public holidays. Do not substitute a different business-day definition.
18. A prepayment penalty is removed before consummation, with no other restart trigger. Which is accurate?
- The consumer automatically receives unrestricted cash back
- No corrected disclosure can ever be required
- A corrected disclosure can still be required, but removal alone is not the added-penalty restart trigger
- Removal necessarily restarts three days
Show answer and explanation
Answer: C. A corrected disclosure can still be required, but removal alone is not the added-penalty restart trigger
Section 1026.19 distinguishes adding the penalty from removing it. The actual change must still be disclosed as applicable.
19. Under the stated example, price is $300,000, applied loan $240,000, buyer costs $9,000, credited earnest money $6,000 and authorized applied seller credit $3,000. No other adjustment exists. How much additional cash is needed?
- $63,000
- $54,000
- $69,000
- $60,000
Show answer and explanation
Answer: D. $60,000
$300,000 - $240,000 + $9,000 - $6,000 - $3,000 = $60,000. Do not subtract earnest money twice; the stated credit treatment is assumed, not an approval of every credit.
20. An optional repair plan excludes an item. What does that alone establish about separate claims against other parties?
- Every legal claim is waived
- It does not decide all separate rights or their applicable conditions and deadlines
- The builder automatically must pay
- Every limitation period is extended
Show answer and explanation
Answer: B. It does not decide all separate rights or their applicable conditions and deadlines
Read the actual coverage and obtain qualified advice about independent rights. No private claim or waiver is adjudicated by this teaching example.
Common questions
What is a real estate closing?
Closing, also called settlement, is the coordinated process in which the parties complete the documents, funds, title work, loan conditions, and other contract requirements needed to finish a real estate transfer. Signing is important, but a closing question may also require you to track funding, delivery, disbursement, possession, and recordation.
When does ownership transfer at closing?
For an ordinary deed, examine valid execution, delivery with present intent and acceptance, along with authority and any actual escrow conditions. Physical handover, acknowledgment, funding, possession and recording answer different questions. Illinois published decisions treat intent and the evidence of delivery as important; a recorder’s timestamp is not a universal transfer rule. Special statutory transfers can have their own requirements.
What does recordation do?
Filing eligible instruments supplies legally significant public notice and can affect priority. Illinois Section 30 specifically addresses creditors and subsequent purchasers without notice; Section 31 also addresses notice despite acknowledgment defects while retaining an execution-proof qualification. Neither provision makes the first filer the winner in every private dispute or cures forgery, missing authority or the wrong parcel. Confirm the actual filing and required correction with the appropriate professionals.
Who usually participates in a real estate closing?
The people and organizations vary with the transaction. Common participants include the buyer, seller, their attorneys, brokers, lender, title company or title agent, settlement agent, recorder, surveyor, insurer, and other professionals needed to satisfy a specific condition. The exam usually asks you to match a task to the correct participant.
What documents should a buyer review before a mortgage closing?
Common documents include the Closing Disclosure, promissory note, mortgage or other security instrument, deed, title commitment, survey, affidavits, tax and proration statements, and any warranty or service contract. The exact package depends on the property, loan, contract, and local practice.
How early must a borrower receive the Closing Disclosure?
In an ordinary covered transaction without an applicable exception, the consumer must receive the Closing Disclosure at least three business days before consummation. For this count, exclude Sundays and the specified legal public holidays; a normal Saturday counts. Consummation means becoming bound on the credit transaction under applicable law, not simply signing a purchase agreement. Non-personal delivery has a separate receipt presumption unless the creditor has qualifying earlier-receipt evidence. Electronic delivery must satisfy its applicable requirements. Timeshares and limited emergency provisions have separate rules; do not assume every sale or borrower follows the same process.
Is a builder warranty the same as a home warranty?
A builder warranty concerns its specified construction coverage. A manufacturer warranty can cover a particular product. A paid home warranty is usually an optional service contract for listed repairs or replacements. Read the actual component, period, exclusions, maintenance conditions, fees, claim method and remedies. FTC’s typical coverage examples are not universal Illinois statutory deadlines, and a plan exclusion does not determine every separate legal right.
Does recording a deed guarantee good title?
No. Recording gives public notice and places the deed in the land records, but it does not guarantee that the grantor owned the interest, had authority, used a correct legal description, or conveyed free of liens. Title examination and any title policy address different questions.
What is the broker's role at closing?
A broker tracks transaction obligations within the brokerage role, communicates known facts, protects deadlines, preserves documents, and directs legal, tax, title, lending, inspection, and warranty questions to the qualified professional. The broker should not give a legal opinion about deed validity, priority, coverage, or contract remedies.
Are these practice questions copied from PSI?
No. These are original teaching questions aligned with the public June 24, 2026 National IX.C topics. The whole Transfer of Title category has six scored national broker questions, not a six-question quota for this page. Explain each choice and practise changed facts; no score here is a validated readiness cutoff or pass probability.
Does a corrected Closing Disclosure always delay closing?
No. Before consummation, the three specified restart events are an APR that becomes inaccurate as legally defined, a changed loan product, and an added prepayment penalty that makes the relevant disclosure inaccurate. Other changes can require corrected information received at or before consummation without a new wait. An APR movement is not automatically a legally inaccurate APR. The lender must evaluate the actual change and any applicable exception.
Do I receive a Closing Disclosure in an all-cash purchase?
The federal covered-loan requirement does not turn an all-cash purchase into a mortgage transaction. Other settlement statements, contracts and disclosures may still apply. HELOCs, reverse mortgages, manufactured-home loans not secured by real estate and specified assistance transactions can use different disclosure requirements. Identify the actual transaction rather than assuming one form serves every closing.
Does recording cure a missing acknowledgment or every other defect?
No such blanket conclusion follows. Illinois Section 35c requires acknowledgment but expressly says failure to comply with that provision does not invalidate the instrument. Section 31 addresses filed notice and its separate execution-proof rule. These provisions do not erase delivery, acceptance, authority or authenticity issues, or guarantee that every document meets all recording requirements. Obtain appropriate legal and title review.
What should I check after the mortgage payoff?
Use the actual payoff requirements and retain payment evidence. Separately confirm that the appropriate release or satisfaction has been recorded and obtain the relevant documentation. Payment and a recorded release are not identical events. A broker should track and flag missing documents without declaring a private lien or title dispute resolved.
Does Saturday count in the Closing Disclosure waiting period?
A normal Saturday does count under the specific rule used for this review period, even if the lender’s office is closed. Sundays and the specified legal public holidays are excluded. Other mortgage rules use a creditor-business-function definition, so identify the exact clock. The Thursday, October 22, 2026 in-person-receipt example reaches its third counted day on Monday, October 26 under its no-holiday, no-exception assumptions.
Does removing a prepayment penalty restart the review period?
Removal alone is not the specified addition-of-penalty trigger. Corrected information can still be required at or before consummation, and another change could independently trigger a new wait. Ask the lender to evaluate the actual disclosures; do not confuse every correction or APR movement with one of the defined restart events.
Is a warranty coverage period the deadline for every legal claim?
No universal conclusion follows. The written promise or plan has its own coverage, conditions and claim process, subject to applicable law. Separate contractual or other legal rights can involve different facts, parties, notices, defenses and periods. Preserve the relevant evidence and seek qualified advice promptly; the lesson does not decide an actual waiver, claim deadline or remedy.
Why are buyer cash to close and seller net different?
Buyer cash accounts for the stipulated purchase contribution, costs, deposits and allowable credits. Seller net accounts for the seller’s receipts, payoffs and seller-side adjustments. In the stated examples, additional buyer cash is $60,000 while seller net is $108,000. These calculations do not certify actual funding, an unrestricted credit, a mortgage payoff or taxable gain. Use the final authorized figures for each side.
Keep practising
Your next practice step
Put transfer of title into practice
Distinguish the deed, title evidence and closing step the question actually asks about.
These web resources are free. The app has a separate free starter tier and optional paid full access.
Official sources and scope
Reviewed October 29, 2026 using the identified Illinois conveyance provisions, published delivery decisions, current CFPB rules and FTC coverage guidance. Source notes distinguish fresh selected readings from earlier actual readings. This lesson does not approve a private closing, wire instruction, title, warranty claim or legal remedy.
- PSI June 24, 2026: types of deeds at national IX.A
- 765 ILCS 5/8: the statutory special-warranty covenants
- 765 ILCS 5/9: the statutory general-warranty covenants
- 765 ILCS 5/10: existing interests, later title and the name-change exemption
- 765 ILCS 5/30: filing and the specified third parties
- 765 ILCS 5/31: record notice despite acknowledgment defects
- 765 ILCS 5/35c: acknowledgment and express noninvalidity provision
- Published Illinois decision: In re Estate of Shedrick, 122 Ill. App. 3d 861 (1984)
- Published Illinois decision: In re Estate of Gabbett (2004)
- 215 ILCS 155/3: title-insurance definitions
- Regulation Z 1026.19(e) and (f): covered mortgage disclosure timing
- CFPB: review documents before closing
- CFPB: contractual closing documents and disclosure exceptions
- CFPB: owner title insurance
- CFPB: lender title insurance
- FTC: builder warranties and home service contracts
- CFPB: checking recorded lien release after payoff
- Regulation Z 1026.2: definitions and business days
- Regulation Z 1026.23: closed-end rescission
- CFPB: mortgage closing scam precautions
- Quinlan and Tyson, 34 Ill. 2d 116 (1966), majority pages 120-123: narrow preliminary-form role; opinion reproduced by Justia
This is exam preparation, not advice for a specific transaction. State law and the applicable facts control. Our editorial and corrections process explains how to report an issue.