What is the definition of a single line entry on a closing disclosure statement?

The definition of a single line entry on a closing disclosure statement refers to an expense paid by one party to an outside third party. In real estate transactions, a closing disclosure provides a detailed account of all financial aspects involved in the closing process. Each entry represents a specific cost associated with the transaction, such as title insurance, appraisal fees, or lender-related charges, typically paid to a service provider or vendor that isn't directly involved in the buyer-seller relationship.

Understanding this entry is crucial as it clarifies the flow of funds and helps both parties comprehend their financial obligations during the closing. This transparency in the financial documentation ensures that all parties involved are aware of their obligations and have clear expectations regarding payment responsibilities. On the other hand, the other options suggest categories of expenses that do not accurately represent the typical purpose of a single line entry in this context, misidentifying their function in the overall structure of the disclosure.