When you buy a home, the HUD-1 form is the final statement of all the charges involved in the deal.
Shortly before closing on a new home, you will be given a Department of Housing and Urban Development Settlement Statement, also called the HUD-1. This is your final account of all of the costs and figures related to the deal. Many of the fees listed in the HUD-1 form would also have been included in the Good Faith Estimate (GFE) of mortgage costs that you would have received from your lender; however, the HUD-1 amounts are final.
You may find some of the HUD-1 figures are different from those in your GFE. This could be because third-party fees such as appraisal fees ended up being slightly different than originally estimated. However, if there are large discrepancies, or new fees that weren't in the GFE, check with your lender to see if there's a mistake that needs to be corrected.
Here's a look at the main parts of the HUD-1 form. In each part, there is one column showing the buyer's (or borrower's) figures and another for the seller's. We will concentrate on the buyer's side.
Sections A through I (General Information)
The form starts with basic information about your loan, the buyer, seller, borrower, and the property.
Section J (Summary of Borrower's Transaction)
Section J shows the gross totals of your costs, your credits, and the net amount you owe for your purchase. It lists the totals by category:
Section K (Summary of Seller's Transaction)
This column lists the gross amount due to the seller, along with any necessary adjustments for items such as taxes that the seller has paid in advance or left unpaid.
Section L (Settlement Charges)
Section L, on the second page of the form, shows all the specific costs for financing and processing of the transaction. It includes:
It's important to read through the HUD-1 form carefully and determine that it's complete and accurate. You and the settlement agent will then both sign it to authorize payment of the funds. Once that's done, the home is yours.
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