Part Four – What Is A HUD-1?

HUD SealWelcome to “What Is A HUD-1?”, a four-part series breaking down the settlement statement that’s used in a real estate transaction. The settlement statement, also known as the HUD-1, is your receipt – it’s an itemization of every penny associated with the sale or purchase, so if it’s money-related then it’ll be shown on the HUD-1. Each party (buyer and seller) or signatory will sign multiple copies of the HUD-1.

A quick note – HUD, which is short for the US Department of Housing and Urban Development, is a department in the federal government that oversees, among other things, housing, and includes departments like Freddie Mac, Fannie Mae, and the Federal Housing Administration.

Parts One, Two, and Three are complete – by this time, your head is swimming, but it’s easy from here on out. The final section is a comparison of the amounts the lender quoted you when you received the Good Faith Estimate, and what you were actually charged.

HUD Comparison

In the first column you”ll see what the GFE showed, and in the second column you’ll see what was charged on the corresponding HUD-1.

The second section of this page is also easy – it shows your loan terms.

HUD Loan Terms

Here you’ll find your initial loan amount, the term, and what the monthly payment (including principle, interest, taxes and insurance) will be. This section will also detail whether or not your interest rate can go up – or down – as well as what it ca rise to. Finally, it will also show whether or not you have an escrow account, and if so, what amount Information regarding the total monthly amount – whether there is a monthly escrow payment.

From there, the seller will have a few more responsibilities, and then the buyer will.

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