The instrument that itemizes the costs from a real estate transaction is known as the US Dept of Housing and Urban Development Settlement Statement known better as the HUD-1 form.  It is a two-page document with a side for Buyer costs and credits and another section dedicated to Seller costs and credits.  In January 2010, a new form was developed to be more transparent of the costs and written in clearer language for the consumer.  Follow the link below to view the new HUD-1 form.

The purpose of a HUD closing form is primarily to be a memorialized document showing how the costs were calculated but the secondary purpose is to clearly bring all costs to a close for the Seller and to begin fresh with new expenses for the Buyer. 

The second or “back” page is for closing costs.  The number is tallied and shown at the bottom.  Both Buyer and Seller numbers are brought forward to page one of the HUD-1 form.  The front page accounts for escrow deposits held, adjusted costs on the date of closing (i.e. real estate taxes, water, sewer, trash, fuel or HOA charges) and shows the mortgage, as provided by a lending institution.

The completed HUD-1 statement will indicate to a Buyer the amount of money that should be brought to the closing to purchase the property.  As for the Seller, it will show the dollar amount to be received from the closing or an amount to be paid to satisfactorily sell the property.  This form should be saved as it may be used at tax time for deductible expenses or may be used to determine a cost basis for a gain or loss.