What Is a Closing Disclosure and What Should I Review Before Signing?

What Is the Closing Disclosure?

The Closing Disclosure is the final, official accounting of all financial terms of your mortgage and home purchase. Your lender must provide it at least 3 business days before your closing date — giving you time to review, ask questions, and catch any errors before you sign binding documents.

What the Closing Disclosure Contains

• Loan terms: Final interest rate, loan amount, monthly payment, and any balloon payment provisions
• Projected payments: Your total monthly PITI payment including mortgage insurance and escrow estimates
• Closing cost breakdown: All fees in detail — exactly what you are paying and to whom
• Cash to close: The total funds you need to bring to closing including down payment and closing costs
• Loan disclosures: APR, total interest over the loan life, and escrow account details

Key Things to Review Before Signing

• Confirm the loan amount matches your accepted purchase price minus your down payment
• Verify the interest rate matches what was promised in your rate lock agreement
• Check that all fees match or are lower than what was shown on the Loan Estimate
• Confirm your closing cost contribution matches any seller concessions negotiated in your purchase contract
• Verify your cash to close amount matches what your lender told you to bring

What Can and Cannot Change From Loan Estimate to Closing Disclosure

Certain fees cannot increase from the Loan Estimate to the Closing Disclosure: lender fees, title insurance premiums when the lender chooses the title company, and transfer taxes. Other fees can change within 10 percent tolerance. Third-party fees you chose yourself (like a specific home inspector) can change without limit. Understanding these tolerances helps you identify problematic increases.

Raise Questions Before Signing

You have 3 business days after receiving the Closing Disclosure to ask questions and request corrections. Do not wait until you are sitting at the signing table with a notary to discover a discrepancy. Rieder Homes Group reviews closing documents with every buyer we represent to ensure the numbers are correct before you commit.

Related Reading on RiederHomes.com:

→ Blog #22: Loan Estimate Explained

→ Blog #6: Buyer Closing Costs

→ Blog #2: Mortgage Pre-Approval

→ Blog #9: APR Explained

— Mance Rieder, Broker Associate | Rieder Homes Group | REAL Broker | riederhomes.com | 858-295-0556