Alabama Real Estate Practice Exam

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Prepare for the Alabama Real Estate Exam. Utilize flashcards and multiple-choice questions, each coupled with hints and explanations. Ace your upcoming test!

Each practice test/flash card set has 50 randomly selected questions from a bank of over 500. You'll get a new set of questions each time!

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What is the purpose of disclosing closing costs a day before closing to recipients of FHA-insured loans?

To allow for negotiation of the loan terms
To ensure transparency and prepare them for the final transaction
To finalize the interest rates
To provide a cooling-off period

The correct answer is: To ensure transparency and prepare them for the final transaction

This is because it is important for recipients of FHA-insured loans to know the exact amount of closing costs they will need to pay before the final transaction. This allows them to properly prepare financially and ensures transparency in the loan process. Options A, C, and D are incorrect because disclosing closing costs a day before closing does not directly affect loan negotiations, interest rates, or provide a cooling-off period.