On a HUD-1 closing statement, the buyer's mortgage is shown as what type of entry for the buyer?

In the context of a HUD-1 closing statement, a buyer's mortgage is represented as a credit entry for the buyer. This is because a mortgage is considered a source of funds used to purchase the property. The credit reflects the amount that the lender is providing to the buyer, which will be applied toward the overall costs of purchasing the home. This entry essentially reduces the financial burden on the buyer by indicating the funds available from their mortgage that contribute to the transaction.

Understanding the structure of the HUD-1 closing statement is crucial for both buyers and sellers. It organizes financial information relevant to the real estate transaction, distinguishing between credits and charges. When reviewing the statement, the buyer will see their total costs for purchasing the property and how their mortgage funds offset these expenses, making it easier to understand the net amount they are responsible for at closing.