All of the following charges involved with the settlement of a residential mortgage loan must be paid at time of closing EXCEPT:

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Prepaid principal is not a charge involved with the settlement of a residential mortgage loan. It is a portion of the loan amount that the borrower is paying upfront at closing to reduce the principal balance of the mortgage. The other charges listed (property taxes, hazard insurance premium, and prepaid interest) are all typically paid at the time of closing.

All of the Following Charges Involved with the Settlement of a Residential