What is the significance of the "Closing Disclosure" document?

The "Closing Disclosure" document holds great significance in real estate transactions as it outlines the final mortgage loan terms and closing costs. This document is provided to the borrower at least three days prior to closing, ensuring they have a clear understanding of the financial obligations they are undertaking. It details critical information such as the loan amount, interest rate, monthly payments, and the total closing costs, including fees for services like appraisal, title insurance, and origination fees.

By summarizing all the financial aspects of the transaction, the Closing Disclosure helps borrowers prepare for the financial commitment they are making. It is a vital tool for transparency, allowing buyers to verify that the terms match what was previously discussed in the Loan Estimate and ensuring that they can make informed decisions.

The other options do not accurately describe the primary purpose of the Closing Disclosure document. While it may reference aspects of the property and financial arrangements, its primary significance lies in the financial clarity it provides to the borrower just before finalizing the transaction.