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HUD-1 Settlement Statement: Sample
Developed by the U.S. Department of Housing and
Urban Development, this document itemizes the services provided,
and fees and charges associated with closing the mortgage loan.
Required by the State of Georgia as a disclosure
to the Borrower(s) that failure to comply with terms and conditions
of the loan could result in foreclosure against the subject property.
Informs the Borrower(s) that the Closing Attorney’s
Office represents the Lender/Investor and not the Purchaser or Seller.
Truth-In-Lending Disclosure: Sample
Also, please see the Truth-In-Lending Explanation.
Discloses the “annual percentage rate” (APR) reflecting
the cost of the mortgage loan as a yearly rate. This rate will probably
be higher than the rate stated on the Note because the APR includes,
in addition to interest, loan discount points, fees, and other credit
costs. Additional information is also provided, such as finance
charges, schedule of payments, late payment charges, and whether
or not there is a prepayment penalty.
Promissory Note: Sample
The instrument the Borrower(s) sign which contains
an unconditional promise to pay, on demand or at a fixed or determined
future time, a particular sum of money to the Lender, a specified
person, or the bearer of the Promissory Note. This document will
outline the basic terms of the loan including names of Borrower
and Lender, Interest Rate, Loan Amount, and period of repayment.
(With Appropriate Riders.) The instrument through
which the Borrower(s) convey the subject property to the Lender
as collateral (or security) for the mortgage loan. This document
will outline the terms and conditions of the mortgage loan.
Attached to the Security Deed, in certain circumstances.
For example: A Planned Unit Development Rider where the subject
property is located in an area with covenants providing for mandatory
assessments (e.g. Homeowner Association fees) or an Adjustable Rate
Rider for Adjustable Rate mortgage loans.
Waiver of Borrower’s Right: Sample
Acknowledges the Borrower’s understanding that failure
to meet the terms and conditions of the mortgage loan could result
in foreclosure upon the collateral property and that this procedure
is non-judicial in Georgia.
Survey/Termite Waivers or Hold Harmless Forms
These are included based on the requirements of
the given transaction. In some instances, mostly Refinances and
Second Mortgages, Surveys and Termite Inspections are not required
and thereby “waived.” In cases where Surveys and Termite Inspections
are required, the closing package will include a “hold harmless”
agreement which serves as notice to the Borrower(s) that such services
were provided by an independent contractor.
Escrow Account Statement
Federally required disclosure on every residential
mortgage loan with escrow accounts for payment of future taxes and
insurance, reflects anticipated receipt and disbursement of escrow
funds over the next (12) twelve months.
IRS Form W-9
Used by the Lender as verification of Borrower’s
Social Security Number and for reporting interest deduction by the
Lender to the IRS.
IRS Forms 4506/8821
Authorizes the Lender to request a copy of Borrower(s)
income tax return directly from the IRS.
Certify that the Borrower(s) intend to occupy the
subject property as a principal residence and that employment status
has not changed since loan application.
The Flood Protection Act of 1973 (Public Law 93-234)
requires the purchase of flood insurance in certain flood prone
areas as designated by the Department of Housing and Urban Development.
Accordingly, Borrower(s) must purchase such insurance if the property
is located in an area where flood insurance is required.
Corrections/Errors and Omissions/Compliance Agreement
Borrower’s Agreement to cooperate with Lender and
Settlement Agent in correcting typographical or clerical errors
in any mortgage documents.
Borrower’s Certification and Authorization
Borrower’s certification that all information provided
to the Lender in association with the mortgage loan was true and
correct and authorizing Lender to re-verify credit information.
First Payment/Coupon Letter
Most Lenders provide a temporary coupon for the
Borrower(s) to make their initial mortgage payment in case the coupon
payment booklet is not received in time for such payment.
Notice of Right of Rescission
Used in case of Refinance and Second Mortgages,
not when property is subject of a sale. Gives the Borrower(s) the
right under Federal Law to cancel the transaction, without cost,
within three business days.
The Remainder of Documents Pertain
Seller’s Affidavit of Residence
Verifies the Seller(s) is not subject to State of
Georgia Capital Gains Tax withholding requirements.
Seller’s Certificate of Exemption
Used in conjunction with above affidavit if Seller
is not a resident of the State of Georgia. Verifies Seller’s exemption
from State of Georgia Capital Gains Tax withholding.
Instrument conveying title to real property from
Seller(s) to Purchaser(s).
Affidavit of Seller(s) certifying that the property
is conveyed “free and clear” of any liens, claims or judgments.