Created by the Consumer Financial Protection Bureau’s (CFPB’s) TILA-RESPA Integrated Disclosure (TRID) rule, the Closing Disclosure (CD) is a five-page form that provides customers with the final details about their mortgage loan. It includes the loan terms, projected monthly payments, and how much the customer will pay in fees and other closing costs.
The lender must deliver the CD to the customer at least three business days before closing. This three-day window is intended to give the customer time to compare their final terms and costs to those estimated in the Loan Estimate (LE) they received shortly after completing their mortgage application. The period of three days also gives customers time to ask their lender any questions they have prior to closing.
The CD is not required on transactions involving reverse mortgages, a home equity line of credit (HELOC), a manufactured housing loan not secured by real estate, or a loan through certain types of homebuyer assistance programs; in those cases, the customer will receive a Truth in Lending (TIL) disclosure instead.