The closing disclosure is the last document you’ll receive before you close on your home loan. Review this detailed five-pager carefully to make sure all the numbers look correct before closing day.
Key takeaways
- Closing disclosures are legally required and provide final details of your loan
- You will have a mandatory three-day period to review the closing disclosure and make any changes
- Errors can be corrected before closing, but the loan amount and interest rate cannot unless there is a change in circumstances
What is a closing disclosure?
A closing disclosure is a legally required five-page statement of your final mortgage loan terms and closing costs. It contains details about your loan terms, monthly payments, fees and closing costs.
Your mortgage lender must provide you with the final details of your loan in the closing disclosure at least three business days before closing. That gives you time to compare the final terms and costs with the information you have previously been given on your loan estimate, the three-page document you received when obtaining the mortgage offer.
You should compare the closing disclosure with the loan estimate to see if anything has changed. If anything is unexpected or incorrect, you have time to ask the lender to clarify before the closing.
What is the three-day rule for closing disclosures?
The closing disclosure three-day rule, formally referred to as the “Know Before You Owe” mortgage rule or TRID (the TILA-RESPA Integrated Disclosure rule), went into effect in 2015.
Visit the Scoop Blog for more information on Closing Disclosures
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