What is a Closing Disclosure? | Consumer Financial Protection Bureau (2024)

The lender is required to give you the Closing Disclosure at least three business days before you close on the mortgage loan. This three-day window allows you time to compare your final terms and costs to those estimated in the Loan Estimate that you previously received from the lender. The three days also gives you time to ask your lender any questions before you go to the closing table.

See a sample Closing Disclosure form with interactive tips and definitions.

Note: You won't receive a Closing Disclosure if you're applying for a reverse mortgage. For those loans, you will receive two forms-a HUD-1 Settlement Statement and a final Truth in Lending Disclosure—instead of the Closing Disclosure. If you are applying for a HELOC, a manufactured housing loan that is not secured by real estate, or a loan through certain types of homebuyer assistance programs, you will not receive a HUD-1 or a Closing Disclosure, but you should receive a Truth-in-Lending disclosure.

What is a Closing Disclosure? | Consumer Financial Protection Bureau (2024)


What is a Closing Disclosure? | Consumer Financial Protection Bureau? ›

Our Closing Disclosure is the official government form that lists all the final details about your mortgage loan. Our interactive sample Closing Disclosure helps you double-check the details and get definitions for terms used on the form.

What is CFPB closing disclosure? ›

A Closing Disclosure is a five-page form that provides final details about the mortgage loan you have selected. It includes the loan terms, your projected monthly payments, and how much you will pay in fees and other costs to get your mortgage (closing costs).

What is the CFPB closing disclosure rule for 3 days? ›

Pre-consummation or account opening waiting period.

A creditor must furnish § 1026.32 disclosures at least three business days prior to consummation for a closed-end, high-cost mortgage and at least three business days prior to account opening for an open-end, high-cost mortgage.

Can a loan be denied after closing disclosure? ›

Despite receiving the Closing Disclosure, loan approval is not guaranteed, and unforeseen circ*mstances can lead to denial, such as changes in financial status or property issues discovered during underwriting.

Is a closing disclosure a good thing? ›

Why are closing disclosures important? The closing disclosure presents the borrower's final opportunity to review the terms of their mortgage, ask questions and understand what they are committing to.

What happens after closing disclosure? ›

No, the closing disclosure is not the last step in the mortgage process. After receiving the closing disclosure, you will still need to sign the document and complete the closing process, which typically includes signing all the necessary paperwork and paying closing costs.

Is a closing disclosure the same as a settlement statement? ›

In the real estate world, the document that used to be called a settlement statement has evolved over time into what is now known as a closing disclosure. However, many still use the term, so you might come across it in the process of closing your mortgage loan.

What is the closing disclosure rule? ›

Your lender is required by law to give you the standardized Closing Disclosure at least 3 business days before closing. This is what is known as the Closing Disclosure 3-day rule. This requirement is thanks to the TILA-RESPA Integrated Disclosures guidelines, which went into effect on October 3, 2015.

Does closing disclosure mean loan is approved? ›

Signing the Closing Disclosure does not automatically mean your loan is approved. It is possible for your lender to find a last-minute red flag and back out of the contract. In other words, getting denied after the Closing Disclosure is issued is possible.

How long after closing disclosure can you close? ›

Lenders are required to provide your Closing Disclosure three business days before your scheduled closing. Use these days wisely—now is the time to resolve problems. If something looks different from what you expected, ask why.

Does a closing disclosure mean clear to close? ›

Clear to close means you're ready for the closing process, while closing refers to the act of closing on your mortgage loan. After you've been cleared to close you'll need to sign your closing disclosure, do a final walkthrough and attend your closing.

Can the loan amount change after closing disclosure? ›

Closing costs can change dramatically if your application has a “changed circ*mstance” — meaning you no longer qualify for, or no longer want, the loan you originally planned on. If your loan application has changed circ*mstances, you will likely receive a revised Loan Estimate and later, a revised Closing Disclosure.

Can a loan fall through after closing? ›

There are numerous reasons a deal could fall through on or after closing day, including buyer's/seller's remorse, missing documents, and more. But it's also possible your loan could be denied at the last minute. And you, the buyer, don't have financing, the deal is off.

Is the closing disclosure the last step? ›

Your Closing Disclosure is the last thing that stands between you and finalizing your mortgage. It may feel like a mere formality to quickly sign before moving into your new home, but the information in the Closing Disclosure must be flawless.

Who is ultimately responsible for the accuracy of the closing disclosure? ›

The lender is primarily responsible for its accuracy and timely delivery to the borrower, while the title agent assists in gathering specific information and may handle both the buyer and seller's side of the disclosure.

What does CFPB mean in mortgage? ›

We're the Consumer Financial Protection Bureau (CFPB), a U.S. government agency that makes sure banks, lenders, and other financial companies treat you fairly.

What does CFPB stand for in mortgage industry? ›

The Bureau of Consumer Financial Protection (CFPB) is an independent bureau within the Federal Reserve System that empowers consumers with the information they need to make financial decisions in the best interests of them and their families.

When must the closing disclosure be received by the applicant? ›

By law, you must receive your Closing Disclosure at least three business days before your closing. Read your Closing Disclosure carefully. It tells you how much you will pay for your loan.

Top Articles
Latest Posts
Article information

Author: Msgr. Refugio Daniel

Last Updated:

Views: 5293

Rating: 4.3 / 5 (74 voted)

Reviews: 81% of readers found this page helpful

Author information

Name: Msgr. Refugio Daniel

Birthday: 1999-09-15

Address: 8416 Beatty Center, Derekfort, VA 72092-0500

Phone: +6838967160603

Job: Mining Executive

Hobby: Woodworking, Knitting, Fishing, Coffee roasting, Kayaking, Horseback riding, Kite flying

Introduction: My name is Msgr. Refugio Daniel, I am a fine, precious, encouraging, calm, glamorous, vivacious, friendly person who loves writing and wants to share my knowledge and understanding with you.