Hud-1 Closing Disclosure

What is hud-1 closing disclosure?

The hud-1 closing disclosure is a document used in real estate transactions to detail all the charges and fees associated with the closing of a mortgage loan. It provides a summary of the buyer's and seller's financial transactions, including the loan terms, closing costs, and any adjustments made during the settlement.

What are the types of hud-1 closing disclosure?

There are two types of hud-1 closing disclosure: the borrower's copy and the seller's copy. The borrower's copy is given to the buyer, while the seller's copy is provided to the seller. Both copies contain similar information but are tailored to the respective party's needs.

Borrower's Copy
Seller's Copy

How to complete hud-1 closing disclosure

Completing the hud-1 closing disclosure involves several steps:

01
Gather all the necessary financial information and documents related to the transaction.
02
Review the loan documents and terms to ensure accuracy.
03
Fill in the appropriate sections with the required details, such as the loan amount, interest rate, and closing costs.
04
Double-check all the entered information for any errors or discrepancies.
05
Obtain all required signatures from the buyer, seller, and any other relevant parties.
06
Submit the completed hud-1 closing disclosure to the appropriate parties, such as the lender and closing agent.

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Questions & answers

A HUD-1 or HUD-1A Settlement Statement is prepared by a creditor or, more typically, by the settlement agent who conducts the closing on the creditor's behalf.
The settlement statement can be provided to the homebuyer and seller by the mortgage lender, settlement agent, title company or a real estate attorney. If you got your mortgage prior to October 2015, you received a HUD-1 settlement statement.
(b) Charges to be stated. The settlement agent shall complete the HUD-1 or HUD-1A, in accordance with the instructions set forth in appendix A to this part. The loan originator must transmit to the settlement agent all information necessary to complete the HUD-1 or HUD-1A.
Sellers and buyers are ultimately responsible for reviewing their HUD-1 statements for accuracy and for ensuring that any errors are corrected before the end of closing. Also, no buyer or seller is obligated to complete a closing until all questions related to the HUD-1 have been answered satisfactorily.
As mentioned above, borrowers taking out reverse mortgages, HELOCs or certain manufactured home loans will get HUD-1 settlement statements instead.
In transactions that do not include a seller, such as a refinance loan, the settlement agent may use the shortened HUD-1A form. If you applied for a mortgage after October 3, 2015, for most kinds of mortgage loans you receive a form called the Closing Disclosure instead of a HUD-1.