Closing Disclosure
A Closing Disclosure is a five-page standardized form that details the final terms, costs, and credits of a mortgage loan. Required by the TRID rule, lenders must deliver it at least three business days before closing so borrowers can review actual charges against the original Loan Estimate.
What This Means
Delivery Timing and Review Period
Under the TILA-RESPA Integrated Disclosure (TRID) rule, the borrower must receive the Closing Disclosure at least three business days before consummation of the loan . This mandatory waiting period gives borrowers time to review final figures and compare them against the Loan Estimate. If certain changes occur after delivery, such as a change in APR beyond tolerance, addition of a prepayment penalty, or a change in loan product, a new Closing Disclosure must be issued with a fresh three-day waiting period .
Contents and Structure
The Closing Disclosure replaced the former HUD-1 Settlement Statement and final Truth in Lending disclosure. Its five pages cover:
- Page 1: Final loan terms, projected payments, and costs at closing
- Page 2: Itemized closing costs matching the Loan Estimate categories
- Page 3: Cash to close calculation, showing the net amount the borrower brings to settlement
- Page 4: Loan disclosures (assumption policy, late payment terms, escrow information)
- Page 5: Loan calculations (total payments, finance charge, APR, total interest percentage) and contact information
Comparing Against the Loan Estimate
The Closing Disclosure uses the same format and line items as the Loan Estimate, enabling direct comparison. Borrowers should verify that charges subject to zero-tolerance have not increased and that cumulative changes to 10%-tolerance items remain within limits. Any discrepancy should be raised with the lender or settlement agent before closing. The form includes a "Did this change?" column on Page 3 that flags changes from the original estimate.