A closing disclosure agreement is an important document in the home buying process. This document is also known as the CD, and it is required by law. The CD is issued to the borrower three days before the closing of the mortgage. The purpose of a CD is to outline all of the terms and costs associated with your home loan.
A CD is a five-page document that details all the expenses you will incur in the home buying process. It includes a summary of your loan terms, details on your monthly payments, and any additional fees associated with the loan. The CD also includes information on the borrower`s loan estimate, which is essentially an estimate of what the costs will be under the loan.
The CD is a legally binding agreement between the borrower and the lender. The agreement outlines the terms of the mortgage loan and the fees associated with the loan. It also includes a section called “Comparisons”, which gives a detailed look at how the fees and costs changed from the Loan Estimate to the Closing Disclosure. When you receive your CD, it is important to examine this section closely to ensure that there are no unexpected surprises at closing.
The CD also includes a section called “Cash to Close,” which outlines the total amount of money the borrower will need to bring to the closing table. This includes the down payment, closing costs, and any other charges that are not covered by the loan.
It is important to review your CD carefully and ask your lender any questions you may have. The CD can be complex and contain confusing terminology. If you are unsure about any of the terms, it is best to consult with an attorney or experienced real estate professional.
The CD is a critical document in the home buying process. It provides transparency for borrowers and helps ensure that they are well-informed about the costs of their mortgage loan. By carefully reviewing your CD and asking questions, you can be confident that you are making an informed decision about your home purchase.