In a transaction where the seller pays buyer loan costs, how are those costs reflected on the closing disclosure?

In a real estate transaction, when the seller pays for the buyer's loan costs, these costs are reflected on the closing disclosure in a specific manner that ensures both parties' obligations are accurately represented. The correct choice indicates that the costs are charged to the buyer, meaning they are included as an expense for the buyer. However, because the seller is the one actually covering these costs, a corresponding credit is provided to the seller. This dual treatment on the closing disclosure highlights the financial arrangement clearly, ensuring transparency in the transaction.

This method both acknowledges the buyer's costs and shows that the seller is contributing to these expenses, thus benefiting the buyer. It ensures that each party’s net position reflects the true nature of the transaction, allowing for clarity on who is responsible for which costs, and maintaining accuracy in financial representation.