The Real Estate Settlement Procedures Act (RESPA) requires that the HUD-1 form be completed when property involving federally related mortgages changes hands. It’s normally completed by the settlement or closing agent and serves to itemize all charges imposed on a borrower and seller of real estate. Although you probably won’t have to fill it out, it is essential that all the information on it be correct or it can hold up the closing.

The borrower must be given a copy of the HUD-1 form at least one day prior to settlement. However, some entries may not be complete until hours before closing.

The information below will tell you what needs to be on a HUD-1 form so that you can make sure the form includes everything that should be on it. Review the form with your real estate agent. settlement agent or attorney before you close on the property you are buying or selling.

Don’t worry about Section A. This requires no entries.

Check the box that signifies the type of loan. The title company will have the file number and the lender provides the loan number. If the loan is insured, there will be a case number. Not all of these boxes may be required.

This is a notice of settlement costs. No additional information is entered here.

Provide all information for the borrower or borrowers. This should include a nine-digit zip code. If more than one borrower is purchasing the property, include an attachment with his/her information. Reference that the information pertains to Section D.

Do the same thing as Section D but this time, provide the information on the seller or sellers. Again, provide a separate page if referencing multiple sellers. As long as you clearly label which parts of the form each piece of information is referencing, you can use a single attachment for all additional information.

Provide the lender information. If a mortgage broker was used, do not include that person or agency in this section.

Where is the property located? Provide the complete address or a legal description of the property if it doesn’t have an address at the time of the transaction.

Provide the settlement agent’s (normally the title company) contact information including name, complete address and phone number including area code. Second, include the address of where the settlement is taking place.

The date of the settlement may seem straightforward but some types of transactions are different. If the property is being purchased, the settlement date is the closing date. If the transaction is a refinance or subordinate lien loan, the date will be different. Contact the closing agent for a date in those cases.

This box itemizes the total amount that the borrower must pay the seller.

Line 101 – The price of the property only. If the parties negotiated a price for personal property, that should not be included in line 101.

Line 102 – Place the price of the personal property here.

Line 103 – The total charges to the borrower copied from line 1400. Extra lines provided (104 and 105) for any extra charges not included in line 1400.

Line 106-112 – Include any items the seller paid that the buyer must reimburse. Examples could include certain insurances, taxes, and association dues.

Line 120 – Add lines 101-120

Lines 200-209 – Money that was prepaid by the borrower or on his/her behalf. Examples include earnest money. a second mortgage. credits from the seller, or allowances that the borrower will purchase separately.

Lines 210-219 – Charges that the borrower has to pay that fall into the time before the settlement. Examples could include certain taxes, utilities used and not paid by the seller, and interest on loan assumptions.

Line 220 – Add lines 201-219

Lines 301-303 – The grand total. Enter line 120 in line 301. Next, enter line 220 in line 302. Subtract 302 from 301. Enter the difference in Line 303.

If you figured out Section J, Section K should be easy. Most of the same rules apply but we’re looking at it from the seller’s perspective this time.

Line 401-405 – Copy the same information from lines 101 and 102. If there are other amounts owed to the seller, pull them over from lines 104 and 105.

Lines 406-412 – Look at 106-112 and copy those figures to these lines. Remember, on the borrower’s side of the form (106-112) you listed that the borrower owes these amounts to the seller. On the seller side, you’re crediting the seller for those amounts owed.

Line 420 – Add all amounts in lines 401-412.

Line 501 – If the seller’s real estate agent is holding earnest money that is more than the fee or commission owed to them, and he/she will give the excess money directly to the seller, enter that amount here. Ask the agent for help and then verify the math.

Line 502 – Enter the total from line 1400

Line 503 – If there are existing liens on the property. enter the lien information here.

Line 504-505 – List the payoff amount of the first mortgage and second mortgage, if applicable. These figures include accrued interest .

Lines 506-509 – Enter deposits paid to the seller or other party who isn’t the settlement agent. Simply enter the amount from line 201. If you used line 501 or a transfer to the settlement agent from the party that has those funds will take place, do not use this section for those purposes. If you’re using this section and have little experience with this form, it’s best to get help.

Lines 510-519 – Carry the figures from 210-219. This is showing that money is being taken from the borrower (210-219) and credited to the seller (510-519.)

Line 520 – Add lines 501-519

Lines 601-603 – Use the same procedures as lines 301-303.

Lines 700-704 – Enter the total amount paid to real estate agents in line 700. Itemize the total in lines 701 and 702. Line 703 lists amount of commission disbursed at settlement. Line 704 is reserved for any additional charges to the borrower that will be disbursed by the settlement agent.

Line 801 – Include any fees that were paid to the loan originator. Do not include points. If an attorney or document preparer was compensated include these charges in this line as well.

Line 802 – This is where you enter any points charged to the borrower. Because the number depends on how the loan was originated, it’s best to talk to the lender about the amount to enter into this line. For more on the topic, read Mortgage Points: What’s The Point?

Line 803 – Add Lines 801 and 802.

Lines 804-808 – On 804-807, disclose any payments made to third party settlement services including appraisers. tax services, flood certifiers, etc. Use Line 808 and, in HUD’s words, any additional sequentially number[ed] lines you add for other required third party settlement service providers. You may also use these lines to record other required disclosures from the loan originator, which must be listed outside of the column.

Line 901 – Enter interest charges that accrue from the settlement date to the first day covered by the borrower’s normal mortgage payments, if applicable.

Line 902 – Enter the mortgage insurance information here. If the payment is a single lump-sum payment, note that as well.

Line 903 – If the lender requires homeowners insurance premiums paid at the time of settlement, include it here.

Line 904 – Include other charges.

Lines 1000-1007 – If the lender required any payments in advance of the settlement, enter those here. If there are charges in this section, an aggregate adjustment has to be made in line 1007. You’ll likely need help with this. Ask your lender.

Lines 1101-1111 – Enter the itemized charges related to the preparation of the property’s title. These can include such charges as attorneys, examination of the title. document preparation and title insurance .

Line 1201-1202 – Include the total of all government charges in line 1201 and the itemization of the total in 1202.

Line 1203 – Transfer taxes are state and local government fees charged for property sales.

Lines 1204-1205 – Enter the amount of city and county taxes and stamps in these two lines. Enter the information inside of the gray box next to “Deed $” and “Mortgage $” and pull the total of the two to the white box.

Line 1206 – Any other third party charges related to government charges.

Lines 1301-1305 – Include any other charges that the borrower was permitted to shop for on his/her own. Home inspection, pest control, home warranties and insurance are a few examples.

Line 1400 – Add all settlement charges and include here.

Comparison of Good Faith Estimate (GFE) and HUD-1 Charges

The purpose of this section is to assure that no charges increased from the good faith estimate more than allowed. This is called disclosure tolerance. This is another section where getting help is well advised. To learn more about this, see Are good faith estimates (GFEs) accurate?

Pull the figures from the good faith estimate into the appropriate column and the listed line numbers from the HUD-1 estimate.

Charges That Can’t Increase More Than 10%

These charges include government recording and settlement charges. Complete both columns and do the math at the bottom of the form. Remember that there cannot be more than a 10% difference. Also take care to pull from the correct lines in the HUD-1 form. In 2015, laws will change leaving much less than a 10% tolerance.

Charges That Can Change

These charges, mostly charges that the borrower may shop for, are allowed to change by any amount. Enter those as you did the top two columns.

Loan Terms- Complete all of the information as supplied by the lender.

The Bottom Line

The HUD-1 form must be correct prior to settlement. Any mistakes will likely hold up the settlement.

If you don’t have experience with this form, ask for help. It’s better to pay a little for an expert opinion than hold up your closing and likely pay more in interest and other charges. See 12 Steps To Closing A Real Estate Deal for more on closings.