Reference notes on closing calculations, settlement statement lines and disclosure practice
Reference notes on the parts of a real estate closing that are easy to get wrong: how the recurring charges are split, which figures belong in which section of the form, and why the settlement statement and the ledger sometimes disagree.
Written for the people who do this work - closing attorneys, paralegals and settlement staff - rather than for buyers. Nothing here is legal advice, and rates, conventions and forms vary by jurisdiction.
Prorations and prepaids
Who owes which days of the tax bill, how the per diem is worked out, and what the payment status changes.
The per diem interest formula, the day count from closing to first payment, and why it belongs in Prepaids rather than Loan Costs.
Government charges
Closing Disclosure
The purchase CD has no payoffs table. Why the total still has to reach the form, and where it goes.
When a lender deducts its fees from the proceeds instead of wiring gross, the disclosure and the funding math diverge.
HUD-1 settlement statement
New York practice
Docketman calculates prorations, prepaids, recording charges and payoffs on the matter and carries them onto the Closing Disclosure, the settlement statements and the ledger.