Alabama Real Estate Practice Exam 2026 – All-in-One Guide to Master Your Real Estate License!

Question: 1 / 400

What is a debit in the context of closing costs?

A discount on the total cost

Money owed by one person to the other

A debit in the context of closing costs is not a discount, as a discount would be a reduction in the total cost, not an addition. It is also not an error in accounting, as a debit is a legitimate transaction that must be accounted for. A debit is also not a bonus for early payment, as this would be a credit instead. The correct answer, money owed by one person to the other, accurately describes a debit in the context of closing costs. In this situation, a debit would represent an amount owed by the buyer to the seller for items such as appraisal fees, title fees, or prepaid interest.

Get further explanation with Examzify DeepDiveBeta

An error in accounting

A bonus for early payment

Next Question

Report this question

Subscribe

Get the latest from Examzify

You can unsubscribe at any time. Read our privacy policy