Mortgage Closing Disclosure: Purpose and Method

mortgage closing disclosure method

In part one of this two-part blog series, we went over some of the basics on mortgage closing disclosures. These are important documents that are sent to borrowers just ahead of their closing day, allowing them to confirm and double-check all the important financial details of the impending mortgage before they sign final documents and move forward.

At Altius Mortgage and our partners with Mortgage Ogden, we’re happy to explain closing disclosures or any other part of the mortgage process to our first-time homebuyers, or to any of our other home loan clients who may be unfamiliar. In today’s part two of our series, we’ll go over why the closing disclosure matters, what you should do with it, and what happens next once it’s been handled.

Purpose of Closing Disclosure

The purpose of a mortgage closing disclosure is to allow borrowers to know exactly what their new mortgage payments will be. Prior to the closing disclosure, they may have been under-estimating those payments by as much as 25% or more! The best time for borrowers to figure out what those final costs are going to be is now, before they sign on the dotted line and finalize their loan.

This will help you avoid issues arising during the actual closing itself. Having all this information up front — and verified as such via the closing disclosure — will allow you to calculate your loan payment as accurately as possible before you sign your final documents and move forward with homeownership.

How to Go Through a Closing Disclosure

As soon as you receive your closing disclosure, you should check it carefully for accuracy. Make sure that all the figures are correct and that you know exactly how much your monthly payments will be after factoring in any other upfront expenses such as private mortgage insurance (PMI), certain closing costs, and even estimated escrow amounts.

Once you’ve gone through it thoroughly, if there are certain figures that you’re not thrilled about or that you feel are inaccurate, don’t sign the closing disclosure just yet. Take a moment to consult with your loan officer, who can help tell you what’s correct and what isn’t.

What Happens After Closing Disclosure

Once everything is confirmed as accurate via the closing disclosure, it will be time to finalize your mortgage and sign the last remaining documents. You’ll be glad you took this time to review the closing disclosure in depth, as it will make for a smooth and straightforward closing process. All you have to do is bring a copy of the disclosure with you to closing day itself, just in case there’s any confusion.

For more on mortgage closing disclosures, or to learn about any of our home loan services or fantastic mortgage rates, speak to the team at Altius Mortgage today.

Mortgage Closing Disclosures: Basics for Park City Homebuyers

mortgage closing disclosures basics

First-time homebuyers entering the market often have a number of questions, especially around the steps and documents involved in the process of obtaining a loan and securing their new home. There are several important facets to the process, and one that’s especially notable near the end of a home purchase situation is known as the closing disclosure.

At Altius Mortgage and our partners with Mortgage Ogden, we’re happy to provide a wide range of mortgage loans and related services throughout Park City and other parts of Utah, including for first-time homebuyers looking for assistance as they enter the market. We’ll assist you with a wide range of documents or related needs that may come up during your homebuying process, including the closing disclosure when it comes time. What is this document, why does it matter, and when will it become part of the picture? This two-part blog will go over everything you need to know.

Closing Disclosure Basics

For those who have not heard of them, a closing disclosure is an important document that comes at the end of a home purchase process, also known as a closing. There are often several different forms that come into play during various parts of the loan process, and one additional form your loan servicer will provide near the end is what’s known as a closing disclosure, which is meant to detail all costs associated with your mortgage.

The closing disclosure will generally be five pages in length, covering a number of different topics and different parts of your loan, including your interest rate, your down payment amount and the terms of your loan. It will also include all costs that you’ll be responsible for or fees that you’ll pay at closing, which can include a wide range of expenses from origination fees to property taxes to various other costs.

When Closing Disclosures Come

The law states that lenders are required to provide borrowers with a closing disclosure at least three days before closing. If you’re receiving a loan to purchase a home, this document is known as the HUD-1, and it’s important for all parties involved to know what it contains and how it will impact their lives after closing on such an important residential transaction.

It’s also important that borrowers go through their closing disclosure in detail, checking it for errors or other possible concerns. If any such mistakes are found, notify your lender immediately to fix the problem and remedy the situation before the closing date itself arrives.

For more on closing disclosures within a mortgage and homebuying situation, or to learn about any of our home loan services or fantastic mortgage rates in Park City, speak to the staff at Altius Mortgage today.