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Does the settlement agent need to provide the seller with a Closing Disclosure?

In performing an audit of loans subject to TILA-RESPA combined disclosures, my bank’s auditor noted that in some instances, the settlement agent had provided to the seller an ALTA settlement statement, HUD-1, or other document with information about the transaction—but not the Closing Disclosure. Must the seller receive a Closing Disclosure?

Yes, both the seller as well as the borrower must receive a Closing Disclosure. The lender/settlement agent either may combine the borrower and seller transaction information in a single Closing Disclosure and provide that to both the seller and borrower or provide two separate Closing Disclosures, which may vary as permitted by the regulation. The settlement agent may provide another form to help explain the transaction, but the seller must always receive a Closing Disclosure. (April 2016)

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