What is a Closing Disclosure?
A Closing Disclosure (CD) is a mandatory 5-page document that provides final details about your mortgage loan before closing. It's your last chance to review loan terms, closing costs, and monthly payments before signing your mortgage documents.
💡 Why the CD Matters
The CD is legally required to be delivered at least 3 business days before closing, giving you time to review and question any discrepancies. This "3-day rule" protects borrowers from last-minute surprises.
Key Purpose of the Closing Disclosure
🔍 Transparency
- • Shows exact loan terms and costs
- • Compares to original Loan Estimate
- • Reveals any changes or surprises
- • Provides clear payment breakdown
🛡️ Protection
- • 3-day review period required
- • Right to question discrepancies
- • Ability to walk away if needed
- • Legal recourse for violations
⚠️ Critical 2025 Update
With rising interest rates and increased closing costs, CD review is more important than ever. Average closing costs have increased 12% in 2025, making careful review essential to avoid overpaying.
- Interest Rate Changes: Even small rate increases can cost thousands over the loan term
- Fee Inflation: Title, appraisal, and origination fees have risen significantly
- Cash-to-Close Surprises: Many borrowers face unexpected additional costs at closing
CD vs Loan Estimate: Key Differences
Understanding the difference between your initial Loan Estimate (LE) and final Closing Disclosure is crucial for protecting yourself from unexpected costs and changes.
| Aspect | Loan Estimate (LE) | Closing Disclosure (CD) |
|---|---|---|
| Timing | Within 3 days of application | At least 3 days before closing |
| Purpose | Estimate costs for shopping | Final terms and actual costs |
| Accuracy | Good faith estimates | Exact final numbers |
| Changes Allowed | Expected to change | Limited changes allowed |
What Changes Are Allowed?
✅ No Tolerance (0%)
These cannot increase:
- Lender origination charges
- Transfer taxes
- Services lender cannot shop for
⚠️ 10% Tolerance
Can increase up to 10%:
- Recording fees
- Services lender can shop for
- Third-party services
🚫 Unlimited Changes
Can change significantly:
- Services you shop for
- Prepaid interest
- Property insurance
🔍 Need Help Comparing Your LE vs CD?
Get expert assistance reviewing your documents and identifying any problematic changes before closing.
Get Document Review →Frequently Asked Questions
When do I receive my Closing Disclosure?
You must receive your CD at least 3 business days before your scheduled closing date. This gives you time to review and ask questions about any changes from your original Loan Estimate.
What if I find errors on my Closing Disclosure?
Contact your lender immediately. Depending on the error, you may need a corrected CD and potentially a new 3-day waiting period. Don't proceed to closing until all errors are resolved.
Can closing costs change after I receive my CD?
Limited changes are allowed. Most fees cannot increase, some can increase up to 10%, and others (like services you shop for) can change more significantly. Any changes may require a new CD.
What happens if I don't receive my CD on time?
Your closing must be delayed until you've had the CD for at least 3 business days. This is a federal requirement that protects borrowers from rushed closings.
Ready to Navigate Your Closing Successfully?
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