What is required by TRID and shows all costs associated with closing?

The Closing Disclosure (CD) is a crucial document mandated by the TILA-RESPA Integrated Disclosure (TRID) rule, which is designed to help borrowers understand the costs associated with their mortgage and closing process. The CD provides a detailed breakdown of all closing costs, including loan terms, monthly payments, and a summary of all expenses such as fees for services, taxes, and insurance.

The purpose of the Closing Disclosure is to ensure transparency and to allow borrowers to compare the final terms and costs of their loan with the Loan Estimate they received earlier in the process. This comparison empowers borrowers to make informed decisions about their mortgage and prepare for their impending financial obligations.

In contrast, while a closing statement and a settlement statement generally summarize costs involved in the closing process, they do not fulfill the specific requirements set forth by TRID in the way the Closing Disclosure does. The Loan Estimate, on the other hand, outlines anticipated costs but is provided before the closing and does not include the finalized details that the Closing Disclosure contains. Thus, the Closing Disclosure is the document that specifically aligns with TRID's requirements for a comprehensive look at all closing costs.