The HUD-1 Settlement Statement is the most important closing document you will sign and by law details all closing costs for both the borrower and seller. Request a copy of your settlement statement before close of escrow (COE), and go over it line by line. Compare the Good Faith Estimate provided by your lender and be sure to check with your lender if there are discrepancies. Lenders are required to keep fees listed on the settlement statement within 10% of fees on the Good Faith Estimate.
At a recent closing on my new home I discovered the Title Company Escrow agent made several careless mistakes that could have cost me close to a thousand dollars. My advice to anyone involved in a real estate transaction is to assume mistakes will be made and it is in your best interest to find and correct them before closing.
Some things to look for: 1) Check all calculations! Simple math errors are not uncommon on settlement statements. 2) Verify tax payments have been made and are accounted for properly. 3) Verify 1st and 2nd mortgage payoff amounts are correct on settlement statement 4) And finally you and your Real Estate Agent should go over sales contract and any addendums and verify all concessions and payments made “outside of escrow” have been accounted for.
By keeping good records and verifying items on your Settlement Statement, you can ensure closing goes smoothly!