Which document details the terms of a mortgage loan and ensures transparency for the borrower?

The closing disclosure is the document that details the final terms of a mortgage loan and ensures transparency for the borrower. It is a comprehensive statement that outlines the loan specifics, including the loan amount, interest rate, monthly payment, and closing costs, among other important financial aspects. The closing disclosure must be provided to the borrower at least three days before closing, giving them time to review the terms and understand their obligations before finalizing the loan agreement.

This document is crucial for promoting informed decision-making, as it consolidates all the key information regarding the borrower's mortgage in a clear and organized manner. By requiring lenders to present this information in a standardized format, the closing disclosure helps to enhance transparency and allows borrowers to compare different loan offers, ensuring they make well-informed choices.

While the loan estimate, truth-in-lending statement, and borrower agreement serve important purposes, they do not provide the complete final overview of the mortgage terms in the same way that the closing disclosure does. The loan estimate, for instance, offers an initial estimate of costs and terms but is not legally binding. The truth-in-lending statement focuses primarily on the cost of credit and the total costs to the borrower, and the borrower agreement typically involves terms of the relationship or responsibilities but lacks the