What is the primary purpose of a settlement statement?

The primary purpose of a settlement statement is to itemize the financial details of a closing. This document provides a comprehensive breakdown of all the financial transactions that take place during the closing process of a real estate transaction. It includes details such as the purchase price, loan amounts, any deposits made, the division of expenses between the buyer and seller, and other closing costs.

By clearly outlining all financial elements, the settlement statement ensures transparency in the transaction, allowing both parties to understand exactly what they owe or are owed. This is essential for ensuring that all financial obligations are fulfilled and for preventing disputes after closing.

In contrast, while calculating seller profits is a relevant aspect of real estate transactions, it is not the primary focus of a settlement statement. Similarly, though listing property taxes can be part of the financial details itemized in the statement, it does not encompass the full purpose of the document, which is broader in scope. Providing legal representation is outside the realm of what a settlement statement is designed to achieve, as it specifically relates to financial documentation rather than legal advice or support.