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Why You Should Pay Attention to Your Closing Disclosures

November 5, 2021

If it’s your first time financing a home purchase or build, you’ll probably come across many documents that you’ve never seen or heard about before. From the loan estimate, to the appraisal, to your closing disclosures – no one ever said buying or building a home would come without a lot of paperwork! While all documentation in the home financing process serves an important purpose, there are some that warrant more of your time and close attention. One of these documents is the closing disclosure. Let’s get into the details about this important disclosure.


What is a Closing Disclosure?

A closing disclosure is a five-page document that your lender is required by law to provide to you at least 3 days prior to the loan closing. This document outlines all the details of your loan, so it’s important to use that 3-day timeframe to comb through the form to ensure you have a complete understanding of your loan details.


In your closing disclosure, you will find:

  • Your loan amount
  • Your interest rate
  • Your monthly payment
  • A list of closing costs
  • Loan costs such as underwriting fees or points
  • A transaction summary
  • Contact information for all parties involved with your loan


Why is the closing disclosure important?

Your closing disclosure outlines all the important details about your loan, so that already makes this a critical form in the home financing process. However, when you receive your closing disclosure, you’ll want to compare it against the loan estimate you received when you first applied for the loan to ensure that there aren’t any unexpected differences between the two documents. If you have any questions about the details on your closing disclosure, you should reach out to your lender to have them addressed prior to closing.


How to review your closing disclosure

Before you go through your closing disclosure, make sure you have your loan estimate on hand.


  1. Make sure all your personal information is correct, including the spelling of your name.
  2. Confirm the property address is correct.
  3. Compare the loan description and details to your loan estimate.
  4. Confirm the loan terms like loan type, interest rate, and monthly payment.
  5. Check the listed fees and verify that no new fees have been added.
  6. Check if your lender is using an escrow account. If so, be sure you understand how it will work.


Once again, if you do find any errors on the closing disclosure, be sure to reach out to your loan officer right away to get it remedied.


If you’ve been considering beginning the home financing process, there’s no better time to start than now! You can get started here!