Three business days before closing, your lender is required by federal law to hand you a five-page document called the Closing Disclosure. It replaces the old HUD-1 Settlement Statement and contains every financial detail of your mortgage transaction — the interest rate you locked, every fee you're paying, your estimated monthly payment for the life of the loan, and the exact amount of cash you need to bring to closing. Most buyers skim it and sign. That's a mistake worth thousands of dollars.
The Closing Disclosure is your last opportunity to catch errors, overcharges, and bait-and-switch tactics before they become permanent. Lenders make mistakes. Title companies add fees. Numbers change between your initial Loan Estimate and the final CD. If you don't catch them in these three days, you're stuck with them for 15 or 30 years.
The Closing Disclosure (CD) is a standardized five-page form created by the Consumer Financial Protection Bureau (CFPB) as part of the TILA-RESPA Integrated Disclosure rule, commonly called TRID. It replaced the HUD-1 Settlement Statement and Truth in Lending disclosure in October 2015. Every mortgage lender in the United States must use this exact form.
Your lender must deliver the CD at least three business days before your closing date. If your closing is on a Friday, you must receive it by the preceding Tuesday. Saturdays count as business days; Sundays and federal holidays do not. If the lender makes certain significant changes after delivering the CD — such as changing the APR by more than 0.125%, changing the loan product, or adding a prepayment penalty — the three-day clock resets and closing is delayed.
You'll receive the CD electronically or by mail. Read every line. Compare it to your original Loan Estimate, which you received within three business days of applying for the loan. The two documents are designed to mirror each other so you can spot changes.
The top of page 1 shows your loan amount, interest rate, and monthly principal and interest payment. Verify the loan amount matches your purchase price minus your down payment (plus any financed fees, if applicable). The interest rate should match your rate lock confirmation exactly. If your rate is 6.5%, it should say 6.5% — not 6.625%. Even a 0.125% difference on a $350,000 loan costs about $30/month or $10,800 over 30 years.
Check the boxes for prepayment penalty (should almost always be "No") and balloon payment (should be "No" for standard fixed-rate and ARM loans). Confirm whether the rate can increase — "No" for fixed, "Yes" for adjustable — and whether the monthly payment can increase.
This section shows what you'll actually pay each month, broken into four components: principal and interest, mortgage insurance, estimated escrow (property taxes and homeowners insurance), and the total. For a $350,000 home with 10% down at 6.5%, expect roughly: $1,991 P&I, $130 PMI, $520 escrow, totaling about $2,641/month.
If your loan has PMI, the projected payments table shows when it drops off. Verify this matches what you were told. Standard PMI on a conventional loan should terminate automatically when you reach 22% equity based on the original value, or you can request removal at 20%.
The bottom of page 1 provides two critical numbers: your total closing costs and the cash to close. The total closing costs figure rolls up every fee from pages 2 and 3. The cash to close is the amount you need to wire or bring as a cashier's check on closing day — it includes your down payment plus closing costs, minus any credits, deposits, or seller contributions. On a $350,000 purchase with 10% down, cash to close might be $42,000–$48,000.
This section lists fees the lender charges you directly. The origination fee (or origination charge) is the lender's primary revenue — typically 0.5% to 1% of the loan amount ($1,575–$3,150 on a $315,000 loan). If you're paying discount points to buy down your rate, they appear here too. One point equals 1% of the loan amount. Verify this matches what you agreed to.
Watch for junk fees: "application fees," "processing fees," "administrative fees," or "commitment fees" that weren't on your original Loan Estimate. Legitimate lenders disclose all origination charges upfront. If a new fee appeared, ask your loan officer to explain it — and demand it be removed if it wasn't previously disclosed.
These are services the lender requires and selects the provider for. Expect to see the appraisal ($400–$700), credit report ($30–$50), flood certification ($15–$25), and tax service fee ($50–$80). These should closely match your Loan Estimate. The total of Section B fees cannot increase by more than 10% from your Loan Estimate unless a legitimate change of circumstances occurred.
These are services where you could have chosen the provider — primarily title-related services. Title search ($150–$400), lender's title insurance ($500–$2,000 depending on loan size and state), owner's title insurance (optional but recommended, $500–$2,000), settlement/closing fee ($300–$600), and survey ($300–$500 if required). If you used the lender's suggested providers, these fees can increase by up to 10%. If you shopped and chose your own providers, there's no cap.
Section E covers taxes and government recording fees — transfer taxes (varies wildly by state, from $0 in Texas to thousands in New York) and recording fees ($50–$250). Section F lists prepaids: homeowners insurance premium (typically 12 months upfront, $1,200–$3,000), prepaid interest (daily interest from closing to the end of the month — if you close on the 25th, you prepay 5–6 days of interest), and the initial escrow deposit (2–6 months of taxes and insurance to fund the account). Section G lists any initial escrow payment at closing. Section H covers other miscellaneous costs.
Page 3 is arguably the most important page. The top section shows the cash-to-close calculation step by step: total closing costs minus any credits, plus your down payment, minus your earnest money deposit, plus or minus any adjustments. Verify that your earnest money deposit amount is correct — this is the money you put down when the seller accepted your offer (typically $5,000–$15,000), and it should be credited toward your cash to close.
The right side of page 3 compares every number on your Closing Disclosure to the corresponding number on your original Loan Estimate. This is where you spot increases. Column by column, you can see what changed and by how much. Federal tolerance rules limit how much certain fees can increase. If a fee exceeded its tolerance, the lender must cure it by giving you a credit at closing.
Tolerance rules work in three tiers: zero tolerance (origination charges, discount points, and transfer taxes cannot increase at all), 10% aggregate tolerance (the total of lender-required third-party services and recording fees cannot increase by more than 10% combined), and no limit (services you could shop for if you used the lender's suggested provider, prepaid interest, and insurance premiums have no cap). Know which tier each fee falls into.
First, check if your interest rate changed. Unless you have a float-down option, a locked rate should not change. A 0.25% rate increase on a $315,000 loan costs $55/month — over $19,800 across 30 years. If the rate changed and you had a lock, demand the original rate and consider filing a CFPB complaint.
Second, look for fees that increased beyond tolerance. Add up all Section B fees on the CD and compare to the Loan Estimate. If the total increased by more than 10%, the lender owes you a credit. Same for Section E recording and transfer fees — the total cannot exceed the LE by more than 10%.
Third, watch for new fees that didn't exist on the Loan Estimate. A "courier fee" of $35 might seem minor, but if the lender is sneaking in small fees, bigger issues may be hidden. Every new line item needs an explanation.
Fourth, verify the loan type and term haven't changed. You applied for a 30-year fixed — make sure you're not signing a 30-year ARM. Check the product description on page 1 carefully.
Fifth, confirm the seller credits match your purchase agreement. If the seller agreed to contribute $8,000 toward closing costs, that exact amount should appear as a credit on page 3.
The three-day review period exists specifically so you can catch problems. Use it. Don't wait until closing day morning to open the PDF. The moment you receive the CD, sit down and compare it line by line to your Loan Estimate. Use a spreadsheet or simply print both documents side by side.
If you find an error, contact your loan officer immediately — by email so you have a written record. Be specific: "Section A origination charge increased from $1,575 to $2,100 with no explanation. Please correct or provide a valid change of circumstance." Most issues can be resolved before closing day if you raise them promptly.
You can waive the three-day waiting period in a bona fide personal financial emergency (for example, foreclosure on your current home), but this is rare and requires a handwritten statement. In virtually all cases, take the full three days.
Title insurance premiums are the most commonly inflated closing cost. In many states, title insurance rates are regulated — meaning the premium should be the same regardless of provider. If your title insurance seems high, check your state's rate filings. In other states, title insurance is competitive, and shopping can save $300–$800.
Courier and wire fees ($25–$75 each) are often padded. Recording fees should match county rates exactly — your county recorder's website lists the fee schedule. Some closers charge $150 for recording when the county fee is $50. Property tax prorations should be calculated based on actual tax bills, not estimates. If the proration seems high, request a calculation worksheet.
One increasingly common overcharge: the "notary signing fee." In most states, the lender or title company covers the notary. If you're being charged $150–$200 for a mobile notary and didn't request one, push back.
Start with your loan officer. Most errors are genuine mistakes — a wrong tax proration, a missing seller credit, a fee that increased because someone forgot to lock a service rate. Loan officers can usually resolve these within 24 hours by issuing a corrected CD.
If the loan officer won't fix a clear error, escalate to the lender's compliance department. Mention TRID tolerance rules by name. If the lender still won't budge, you have options: file a complaint with the CFPB (consumerfinance.gov/complaint), contact your state's attorney general office, or walk away from the transaction. Yes, you can walk away before signing, even on closing day — and if the lender violated tolerance rules, you may have grounds to recover your earnest money.
Use our closing costs calculator at /closing-costs-calculator to estimate what your fees should look like before you even receive your CD. Going in with realistic expectations makes it much easier to spot when something doesn't add up.