A HUD-1 Settlement Statement is a document used in a residential real estate closing to show an itemized list of the charges of a transaction and all the incoming and outgoing payments of both the buyer and the seller.
The HUD statement should be prepared by a settlement attorney because it is one of the most complicated documents in the closing process. It should be given to the buyer and seller of the house to review the day before the closing, although changes may be made to the document within a few hours of the closing.
Once received, the HUD statement should be reviewed by the buyer and seller with their respective real estate agent or real estate attorney. Any mistakes or discrepancies should be brought to the attention of the settlement attorney as soon as possible.
HUD stands for Housing and Urban Development. It is the arm of the government responsible for legislation regarding home ownership and property development.
The Real Estate Settlement Procedures Act (RESPA) requires a HUD form to be used in all residential transactions in which a federally related mortgage is involved, but it can be used for any transaction involving a buyer and seller, including cash closings.