What is a HUD-1?

If you are in the process of buying or selling a home and hear someone mention a HUD-1, you may wonder what they are talking about.

If you don’t know, HUD is the Department of Housing and Urban Development, and the HUD-1 is a standardized form that HUD created.
It is an itemized sheet that lists what the buyer and seller are paying to complete the sale of a residential property. This includes: commissions, loan fees, escrow, insurance, property taxes, points, transfer taxes, plus appraisals and other expenses that are not a part of the closing.

The closing agent fills out the form and it is signed by both parties in a real estate transaction (buyer and seller).
A buyer should see the HUD-1 at least one business day before closing. Ideally, buyers would see the form sooner than that, but since it contains information that must be gathered from several places, that may not be possible.

Sellers must also check the HUD-1 to make sure that the charges such as commissions, transfer taxes and their share of property taxes have been assigned correctly.

Signing the form is an indication that you agree with all of the information states there. If you see an error, don’t sign and then mention it later because it is not easy to have a mistake addressed once you’ve signed a HUD-1. If it is necessary, you may have to postpone the closing to have the issue addressed.