HUD-1 and HUD-1A disclosure of un-advanced funds


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    An Attorney’s that we use to close loans has prepared the HUD-1 on a loan to purchase property in connection with a consumer non-revolving draw loan to construct a dwelling. The Attorney put “Funds Held for Future Advance” on line 104 for the amount available to the customer to draw in the future so the HUD-1 on line 303 would show the cash due from the borrower for closing cost.
    On another loan with HUD-1A for consumer purpose, when the customer was receiving cash out on a refinance the attorney put the disbursement amount being paid to the customer on line 1501 ((example John Doe (John Doe being the borrower) $25,000.00)) instead of letting the amount show on line 1604 which states “Equals Disbursements to Borrower (after expiration of any applicable rescission period required by law)”.
    Can you please let me know if this is an acceptable way to list these items? I have reviewed 12 CFR 1024 Subpart C concerning the use of these lines. I really don’t agree with the Attorney, but I want a second opinion before I contact the Attorney.


    Regulation X contains detailed instructions for completing the HUD-1 and the HUD-1A. Additional guidance is provided in the Frequently Asked Questions. It appears that the forms were not completed according to the instructions in the examples you describe. There is no upside to deviating from the instructions.

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