In the last part we looked at the HUD-1 statement Buyer section in detail. Similarly let’s look at Page-1 right side, Seller breakdown for Seller’s perspective:



1S – This section represents the amount which seller should receive from this transaction which are paid by the buyer.

1.1S – This section represents all credits to Seller connected with already paid taxes.

2S – This section reflects all deductions like option fee, current mortgage payoff and settlement cost related to the transaction. An important point about Line 504 shows the amount of the seller’s mortgage loan payoff, and that most all loans are paid “interest in arrears” so payoff will include the principal balance and accrued interest to the date it is normally received by your lender. Title companies have to insure that adequate monies are collected for this purpose and the payoff will normally include 3-5 days of interest and your lender will refund the excess.

The payoff statement will not include a credit for any monies you may have in your escrow account. These monies are handled separately and will usually be sent to seller 2-4 weeks after the loan is paid in full.

2.1S – This section is related to tax amount owned by the seller for the current year which is paid to the buyer so buyer will pay the tax when time comes. Seller is not obligated to pay the tax at the time of closing.

3S – Finally this line reflects the total amount which seller suppose to receive in cash at the end of closing.

Let’s take a look at Page-2 to understand some breakdowns which make up Page-1 totals.


As mentioned earlier, Page 2 of the HUD statement reflects the subtotal of all the buyer’s closing costs and related charges and the same for the seller.

Line #700 series is related to the seller reflecting the total commissions paid to the Realtor.

Line #800 series reflects the closing costs owing to the lender by buyer and these should reflect the GFE “Good Faith Estimate” that the lender is required to give to borrowers during application. Usually these numbers might have difference from the GFE.

Line 901 will reflect the interest owing by buyer from the date of closing through the end of the closing month. Then the first payment will normally be due the following first of the next month succeeding. If buyer has agreed to or is required to establish an escrow account the initial deposit will be reflected in Lines 1001 through 1008. Now switch your attention to Line 1008 “Aggregate Adjustment Analysis”, which represents a mandatory test that lenders and title companies must perform to insure that the minimum amount is placed in escrow since the lenders don’t normally pay interest on escrow monies. If Line 1008 indicates 0.00, this means the test was performed and the correct amounts were escrowed. If Line 1008 reflects a negative number this means that the test results mandated that too much was placed in escrow and the adjustment was made to insure compliance with this regulation.

Lines 1100 through 1113 reflect all the closing fees, including such things as:
Settlement of closing fee, Title Exam, Title Insurance Binder: (this is the fee that is required for the title company to issue any title insurance policy, either for the lender or for a buyer buying an owner’s policy.

The 1200 series reflects the charges imposed for the title company to deliver and record the deed and/or mortgage. Home warranty payments will be reflected on Lines 1303-5 or alternatively on Line 507 on Page 1.

Line 1400 reflects the subtotals of all the charges for both buyer and seller and will be carried forward to the Page 1.

The last Page-3 of the HUD-1 statement is the comparison of actual charges with GFE(Good Faith Estimate) provided by the lender to the Buyer and explaining the monthly mortgage amount. Good Faith Estimate with expected closing costs should be provided by lender when you make application for your loan. It is a requirement, and you should ask for it if your lender is not providing one for you. Here is a sample of the Page-3.

Here a youtube video from a lender which explains the HUD-1 statement in detail.



It is very important to understand the HUD-1 statement before closing so you can cross check every amount and make sure everything is accounted accordingly. There are chances for mistakes from title company since they do many closings a week. It is your responsibility and agents duty to help the client to cross check the HUD statement before closing and get ready for the closing.

About Vijaianand Thirnageswaram

I am a Proud Realtor of Texas, trying to guide and help clients to find their dream home and educate them to buy them for right price. I am also a Candidate for CFP who has more financial knowledge which allows me share and educate clients in any financial decision making process.

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