This type of loan can also be federally guaranteed or insured loans as well as loans that are to be sold to the secondary mortgage market. An information booklet prepared by HUD must be given to the borrower within three business days of the loan application. If the lender or broker requires the use of a particular service provider, such as an attorney, title company, or insurance company, the lender must disclose its relationship with that service provider and estimate the costs involved. Where a lender or broker has more than a one-percent interest in a service provider, that interest must be disclosed, and the borrower must be allowed to obtain the services from other providers. Settlement statements list in detail the credits and debits of both buyer and seller.
Credits are items to which parties are entitled.
When a buyer assumes a loan, it reduces the amount needed to purchase the property. This means that the transaction is a credit against the sales price for the buyer and debit to the seller against funds to which the seller is entitled. Many settlement costs are subject to negotiation. Depending on local custom, costs associated with closing such as title insurance, taxes, inspections, attorney's fees, and appraisal may be charged to the seller, the buyer, or both. Most states, including Washington, have a real property transfer tax.