Filling up Settlement Statement (HUD-1) form

Real Estate Closings Understanding the Settlement Statement

The Real Estate Closing

• Know the players • Settlement/Closing agent • Title agent • Escrow agent

HUD Changes in 2010 Good Faith Estimate “Protections”

• Residential Settlement Statement with GFE completed

Settlement Statement with seller-financing proration of rent / security deposits

Residential Settlement Statement with GFE completed

Seller Financing - CV 2004

Residential HUD1 with GFE

Preliminaries prior to closing

• Tenant Estoppel Letters

• Mechanic’s Liens Affidavit

• Corporate Resolution & Operating Agreement • If LLC

Tenant Estoppel Letter

Corporate Resolution - WRS

Preliminaries prior to closing (continued)

• Title review • Concerns over clouds on title?

3/8 Coal Interest

Recording & Taxing Value at Conveyance

• Real Property Transfer Report • Note states that are exceptions

• Transfer Tax

Newfield Mall

The Newfield Mall Settlement Statement

Fact Pattern

HUD1 Settlement Statement

Fact Pattern - Newfield Mall

Settlement Statement - Newfield

Buyers Day / Sellers Day • City Taxes

• March 31/April 30/May 31 = 31+30+31 = 92 • + 13 days not including day of closing = 105 days • $550,000/$1,000 = 550 * 16.20 = $8910 • $8910 / 365 = $24.42 * 105 days = 2563.15

• County Taxes • 365 days – Jan 30 days and Feb. 15 days = 319 days • 319 days + 13.86 per diem * 319 days = 4422.30 • Note states that are exceptions

• School Taxes • 135 days + 30 days of June * 27.08 per diem = 3655.54

Rent Pro-ration • Maximart:

• 5,000 x $12 = $60,000 / 12 months = $5,000 • $5,000 * (13/28) = $2321.43 • Sec. Dep: $5,000 * 2 = $10,000

Mortgage Payoff

• Existing mortgage payoff • $125,000 * (.075/365) * 46 days

Deed Stamps/ Transfer Tax

• Purchase price not mortgage amount • $600,000 / $1,000 = $600 * $6 • = $3,600

New Loan • Where do we find guidance on loan

payments? • Promissory Note provided by new lender

• Interest through February 28th • $450,000*.0725 / 365 = $89.38 per day * 14

days = $1,251.37

Promissory Note - Newfield

Mortgage Tax

• Mortgage Tax ($5 per $1,000 of loan amount) • On Mortgage amount only • $450,000 / $1,000 = $450 * $5 = $2,250

Title Insurance

State Regulation or

Market priced

Where do we put all these line items?

Paid out of Closing (POC)

Post-closing “it ain’t over till the paperwork is done.”

• Wire transfer

• Mortgage release

• Recording of Deed