Hi, Steve.
It sounds like you have the concept well in mind. All you need is some guidance in how to record this in Quicken.
In accountant-speak, the HUD-1 statement is just like a general journal entry, with debits on one side and credits on the other, and the two sides add up to the same total - they balance. The buyer's copy of the HUD-1 is mostly a mirror image of the seller's copy. On the buyer's copy, the actual price of the home is a debit; on the seller's copy, that number is a credit.
In addition to the agreed price of the property, the buyer's side should show any buyer's expenses paid from escrow, plus deposits into the lender's impound accounts (called the lender's escrow accounts in some areas), and sometimes other amounts. On the credit side, you might see such things as the seller's share of real estate taxes that you will have to pay when the due date rolls around (depending on the practice in the area). But the biggest credits will show how you are paying for the home. The largest will likely be the starting balance on the loan (or loans) to provide the money to buy the home. There should also be a credit for the down payment. And there probably will be either a credit for additional amounts you paid in to cover "closing costs", or a debit for a refund check to you if there was more cash paid into escrow than required for all those debits.
In Quicken, this is probably best handled in two or more entries. The first would be for the down payment, recorded as a check paid into an Asset Account with a name such as Suspense or Escrow or Down Payments. The name of the account isn't important, and the account will live only until close of escrow. If you have to pay an additional amount into escrow for closing costs, that should go into this Suspense account, too. Don't try to categorize these advance payments as they are made; wait until you record the HUD-1 statement for the overall transaction.
The big entry will reflect just what you see on the HUD-1 statement. Using your checking account register, create a big Split entry. Charge the home price, plus any costs of acquiring it, into the new Home Account; charge (or credit, if you get any credits) the expenses for taxes, insurance, etc., into your normal expense Categories; charge your impound prepayments for taxes and interest into a new Lender Impound Account; and credit the big loan amount into the Home Mortgage Liability Account. In many cases, the net of the Split transaction after all these amounts will exactly zero out your Suspense Account, because the only debits and credits left on the HUD-1 statement will be the down payment and any additional payments you made or any refund at close of escrow.
When all the dust has settled, your Quicken should show just a few balances. The cost of your new home, including acquisition costs paid through escrow, will be in your Home Asset Account (by whatever name you choose). Your opening impound payment will be in the Lender Impound (asset) Account. Expenses for taxes and interest will be either plusses or minuses in your expense Categories. Your Suspense Account should have a zero balance. And your checking account should be correct.
I've not needed to set up a home loan transaction since Quicken added the wizard several years ago, so I can't offer any guidance on that, but I'll bet you already have it figured out.
Enjoy your new home, Steve!
RC