A seller’s closing statement (also known as a settlement statement or closing disclosure) is an itemized list of every expense in your home sale, from commissions to closing fees.
Understanding this document is crucial to knowing what you are paying and that no one accidentally overcharges you for something. Here are a few details surrounding a seller’s closing statement that you can expect:
- Delivery timeline: At least three days before closing
- What it covers: Closing costs, including mortgage payoff, agent commissions, title and escrow, taxes, repair credits, etc.
- Who gets a copy: The seller, listing agent, title or escrow company, seller’s real estate attorney (if they have one)
If you’re about to sell your home and are curious about what to expect from a seller’s closing statement, this guide breaks down everything you need to know.
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When do I get a seller’s closing statement, and who prepares it?
Your closing agent — a neutral third party like a title company, escrow officer, or real estate attorney — collects the sale data and prepares the statement.
Relying on an outside agent prevents any motivation for people involved in the sale to falsify numbers. Your closing agent is also more thorough when gathering information because they can make it a primary focus leading up to your closing date.
Closing statement timing
Settlement statements have a firm delivery deadline of three business days before the closing date.
This timeline allows you to review the document before the sale is finalized, enabling you to identify any discrepancies you may notice while reviewing the statement.
After you review the document, you’ll sign the statement at your closing agent’s office to approve the sale.
What exactly is in a seller’s closing statement?
Seller’s closing statements lay out all of the credits (money owed to you) and debits (money you owe) included in your real estate transaction. Here’s what you can typically expect:
➕ The home’s sale price
This is the agreed-upon total the buyer will pay. It reflects the final price after negotiations and may be more or less than your initial listing.
➕ Earnest money
Some sales require buyers to put down a deposit to prove their interest in purchasing your home.
This “good faith” money is typically stored in an escrow account and shown as a credit on your seller’s closing statement.
➕ Prorated property taxes
Depending on negotiations, the buyer may reimburse you for the prorated property taxes that are due when your home closes.
➕ Reimbursements for prepaid expenses
If you paid for your HOA fees, utilities, or homeowner’s insurance early (for example, you pay a yearly premium on insurance rather than month-to-month), any credits from these prepayments will be on your settlement statement.
➖ Outstanding mortgage payoff
If you still owe on your mortgage, the current balance will appear as a debit on your seller’s closing statement.
It’s essential to cross-reference your latest mortgage statement to ensure these figures align.
➖ Real estate commissions
Your closing statement will include the portion of the commission you are responsible for.
In the past, sellers were responsible for paying both the listing agent's and the buying agent's commissions.
However, a 2024 NAR settlement ruled that buyers must negotiate and pay their agent’s rates (unless the seller agrees to cover the entire cost).
➖ Title insurance
Title insurance protects buyers and lenders during the title transfer process in case any issues arise, such as an undisclosed lien, ownership dispute, or other errors. Title insurance is typically optional for buyers but required for lenders.
If it helps with negotiations, you could offer to cover the title insurance fee as a good-faith gesture that your buyer will receive a clean title after closing.
➖ Escrow or attorney fees
Any charges for working with a real estate attorney will show as debits on the seller’s closing sheet.
You might also contribute to paying the buyer’s escrow company for holding funds in the account and managing the payout process.
➖ HOA, property tax, or insurance payoff
If you haven’t paid HOA fees, property taxes, or homeowner’s insurance fees yet for the year, you’ll be responsible for paying a prorated amount of what you owe at closing.
➖ Repair credits
You may agree to offer repair credits for any work that needs to happen on the house after closing. Any offered repair credits will be deducted from the sale price of your home on the closing statement.
💰Excess deposits: What are they, and why do buyers use them?
Your closing statement may include the line item “excess deposit.” This line item includes any additional funds the buyer paid beyond the initial deposit. A buyer might put down an excess deposit if:
- They want to show a stronger commitment to buying in a competitive market
- They want to speed up the escrow process or strengthen negotiations
- They want to increase their deposit after waiving contingencies or renegotiating terms
Seller’s net sheets vs. closing statements
Both seller’s net sheets and closing statements break down your home sale by line item, but they have some key differences. Here’s how they compare:
| Seller’s Net Sheet | Seller’s Closing Statement | |
|---|---|---|
| An estimate of the seller’s net proceeds | ✅ | ❌ |
| Final breakdown of closing costs and payout | ❌ | ✅ |
| Happens when the selling process begins | ✅ | ❌ |
| Happens at closing | ❌ | ✅ |
| Prepared by the listing agent | ✅ | ❌ |
| Prepared by a third-party closing agent | ❌ | ✅ |
| A binding legal document | ❌ | ✅ |
| Includes invoices from the sale | ❌ | ✅ |
How to read a seller’s closing statement and what to look for
It’s essential to review every line in the form carefully. Double- and triple-check that what you agreed to when making the sale is in the document, and work with a professional realtor for guidance to ensure everything is accurate.
Trusted real estate agents close deals every day and know the ins and outs of real estate transactions. As a seller, there is no more valuable asset than working with an experienced agent.
If your property transaction is not a typical sale and is more complex, you may also want to have your attorney review it before signing off on it.
Common seller closing costs and who pays what
Seller’s closing costs are typically 1-2% of the sale price of your home. That means if you sell for around $500,000, your closing costs will be between $5,000 and $10,000.
Typical seller’s closing costs include:
- Transfer taxes
- Title insurance
- Escrow fees
- Recording fees
- Attorney fees
- Unpaid HOA dues
While not typically referred to as a “closing cost,” real estate agent commissions are included on the closing statement as a debit.
Typically, you will be responsible for paying around 2-3% commission to your listing agent — $10,000 to $15,000 on a $500,000 home — and that cost may double if you agree to cover the buying agent’s commission as a selling incentive.
| Item | Buyer | Seller |
| Lender’s title insurance policy | ✅ | ❌ |
| Transfer taxes | ❌ | ✅ |
| Escrow/settlement fee | ✅ | ✅ |
| Property taxes (prorated) | ✅ | ✅ |
| Loan origination fees | ✅ | ❌ |
| Appraisal fees | ✅ | ❌ |
| Recording fees | ✅ | ❌ |
| Home warranties | ❌ | ✅ |
| Repair credits | ❌ | ✅ |
HUD-1 vs. Closing Disclosure vs. settlement statement
HUD-1 forms
HUD-1 forms were standard closing documents until 2015, when the Consumer Financial Protection Bureau (CFPB) implemented a new federal rule to increase transparency in real estate transactions.
Now, government-backed loans and non-traditional purchases, such as reverse mortgages or cash sales, are typically the only transactions that rely on HUD-1 forms.
Closing Disclosures
As a result of this shift, Closing Disclosures (CDs) became the new standard.[1] These documents are more consumer-friendly, making it easier to understand the closing costs associated with buying and selling a home.
CDs disclose all the details of a mortgage, including loan terms, projected payments, closing costs, and loan costs, and are legally required to be delivered three days before closing.
Settlement statements
Settlement statements, like a seller’s closing statement, are supplemental documents to the Closing Disclosure that break down expenses line by line.
These documents are distributed to both buyers and sellers, making it easier for everyone involved to understand what is deducted and credited to each party.
After closing: Record-keeping & taxes
It’s essential to hold on to your closing statement for as long as you own your home for tax and record-keeping purposes. Here are some of the reasons why filing this document away in a safe place is a wise choice:
- Some items are tax-deductible during the year you sell.
- The statement can be helpful if you are ever audited.
- If you resell, it supports your cost basis when calculating capital gains.
After you close on your home, consult a tax advisor to ensure you properly file your income tax for the year.
An advisor can help you identify things you may have overlooked and help you take the proper measures to ensure you’re filing as accurately as possible.
Sell with Clever to make the process easier
Seller’s closing statements can be tricky to evaluate and understand without assistance.
By working with a trusted real estate agent, you can have the peace of mind that someone is helping you make the right decisions every step of the way.
Clever can help by matching you with top real estate agents in your area from reputable brokerages, like Re/Max and Compass. We’ll also negotiate better rates on your behalf (typically a 1.5% commission) to help you retain more of your profits.
Learn more about how Clever can help you sell your home today!