Real estate is one of those businesses that can help you build wealth fast. It can make you a millionaire in no time and can also account for big losses. The constant rise in prices and market values of properties is the real beauty of this industry. However, learning the art of the game is important to have a successful career because making projections through evaluation of bookkeeping and financial records is no easy feat. Investors who have the potential to read the market well can expect to have a long and healthy career in the real estate industry.
Real estate has a lot to offer to stakeholders. From investors (individuals or banks) to the middlemen (real estate agents) to clients—everyone claims their share. However, most investors are the ones who earn the most because of their capital investment and financial risks.
A Brief Account of a HUD Statement
In a real estate business, investors need to abide by rules and regulations set up by the government. Proper paperwork is of extreme importance when applying for loans to purchase and refinance in real estate. Obviously, not every real estate investor is able to finance everything with their own money. Most investors need help from banks for capital financing. The Department of Housing and Urban Development (HUD) is a US government-owned agency that primarily supports community development and home ownership.
What is a HUD Statement?
According to studies, investors who are good at managing and maintaining their business books and statements earn more from high markups on real estate investments. Most investors involve banks for the acquisition of loans for purchasing or refinancing. The HUD is one such statement that gives a complete synopsis of the settlement of funds at the end of a transaction. The services and fees are charged by the lender or broker to the borrower when applying for a loan in real estate. It includes the type of loan, a summary of the borrower’s and seller’s transactions, settlement charges, loan terms and conditions as well as other similar sub-requirements.
Recording a HUD Statement
When it comes to recording a HUD statement in a real estate business, you need to be very careful filing the detailed form. Any discrepancies found in the form will lead to a rejection of loans or credits. Since the statement shows a detailed itemization of all costs pertaining or referring to the real estate sale and mortgage loan transaction, it is recommended to hire the expertise of professionals for ideal recording of the statement. The closing agent has the option to close the statement altogether or treat both borrower and lender’s transactions individually.
Breakdown of a HUD Statement
Closing agents have prior experience in dealing with HUD statements as well as sale and mortgage loan statement. Therefore, they know what each section means and how it must be filled out appropriately. However, if you are doing it yourself, know that buyers are referred to as borrowers and lenders as sellers. It consists of 3 pages and a signature page consisting of figures, lots of figures! It may also include an addendum.
Page 1: Shows the summary of the borrower and seller’s transaction.
Page 2: Shows details of the associated fees and charges involved with the settlement such as broker fees, loan fees, title charges, additional settlement charges, government recording and transfer charges, deposits reserved with the lender and more.
Page 3: Features figures related to the Good Faith Estimate (GFE) and breakdown of terms of loans.
About Complete Controller® – America’s Bookkeeping Experts Complete Controller is the Nation’s Leader in virtual accounting, providing services to businesses and households alike. Utilizing Complete Controller’s technology, clients gain access to a cloud-hosted desktop where their entire team and tax accountant may access the QuickBooks file and critical financial documents in an efficient and secure environment. Complete Controller’s team of US based accounting professionals are certified QuickBooksTMProAdvisor’s providing bookkeeping and controller services including training, full or partial-service bookkeeping, cash-flow management, budgeting and forecasting, vendor and receivables management, process and controls advisement, and customized reporting. Offering flat rate pricing, Complete Controller is the most cost effective expert accounting solution for business, family office, trusts, and households of any size or complexity.