prorations

Definition

The closing day arithmetic splitting property expenses and income between buyer and seller based on ownership periods. It's the financial equivalent of splitting a restaurant check by who ordered what.

Example Usage

The settlement statement showed prorations for property taxes, HOA fees, and prepaid rent, crediting the buyer $2,847.

Origin

From Latin 'pro rata' meaning proportionally, standard in real estate closings since formalized settlement procedures emerged

Fun Fact

Proration disputes over who pays for the closing day itself have generated enough arguments to keep escrow officers employed since forever.

Source: Real estate closing and settlement terminology

Related Terms

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The predicted housing market flood as millions of boomers simultaneously try to sell their family homes and downsize, potentially tanking prices. It's demographic destiny meets real estate economics, and millennials are waiting with popcorn.

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rent roll

A spreadsheet listing all tenants in a rental property along with their lease terms, payment history, and unit details—basically the property's financial DNA. It's the first thing savvy investors scrutinize when evaluating a deal.

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appraisal gap

The painful difference between what a buyer offered and what the property actually appraised for, requiring either price renegotiation or the buyer coughing up extra cash. It's the financial buzzkill of hot markets where emotions outbid mathematics.

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seller carry-back

When the seller provides financing to the buyer instead of requiring a traditional mortgage, essentially becoming the bank. It's either a creative solution or a sign someone couldn't qualify for actual financing.

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gcfr

Ground Coverage Floor Ratio—the percentage of a lot covered by a building's footprint, regulating density and preserving open space. A municipality's way of preventing you from covering every square inch with structure.

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