Final answer:
An escrow agent inputs the broker's commission in the Closing Disclosure as part of the seller's transaction costs, which is typically a percentage of the property's sale price. The escrow process also helps manage regular property-related expenses, such as home insurance and property taxes, in a single monthly payment.
Step-by-step explanation:
An escrow agent handling the preparation of a Closing Disclosure for a property closing will typically record the broker's commission as a cost of the transaction. In real estate transactions, the broker's commission is a fee paid to the real estate agents for their services and is usually a percentage of the sale price of the property. This fee is normally paid by the seller and is included in the Closing Disclosure under the section detailing the seller's transaction costs. The purpose of the Closing Disclosure is to itemize all fees, costs, and adjustments involved in the transaction for both the buyer and seller.
Escrow services facilitate a more manageable transaction by holding funds in trust until the transaction is complete and managing payments for recurrent property-related expenses like home insurance and property taxes as part of the buyer's normal monthly payment. This creates a streamlined process that can reduce the administrative burden on the homeowner.