Proration
Splitting ongoing costs like property taxes, HOA dues or rent between buyer and seller based on the closing date. Each side pays only for the days they own the property.
Also called: prorations, prorated, prorate
Related terms
An itemized list of every charge and credit for the buyer and seller in a sale. It shows exactly where each dollar goes at closing and should match the Closing Disclosure.
A yearly tax set by local governments based on a property's assessed value. Lenders usually collect it monthly through escrow, and rates vary widely by location.
The organization that runs a condo, townhouse, or planned community. It collects dues, maintains common areas, and enforces rules that owners must follow.
The date set in the contract for the sale to close. It can move only if both sides sign an amendment.
Fees and charges paid at closing on top of the price, such as lender fees, title insurance, recording fees, taxes and prepaid items. Buyers often pay around 2% to 5% of the price; sellers pay their own set of costs.