Closing Disclosure (Borrower): The Ultimate Notary & Loan Signing Agent Guide
The Closing Disclosure (CD) is the document borrowers care about most—even if they don’t realize it yet. It’s the financial truth serum of the transaction. When handled well, it builds trust and confidence. When handled poorly, it can delay funding, kill deals, or trigger compliance violations.
This guide breaks it down so cleanly you’ll be able to explain it to a nervous signer at 9:47 PM without breaking a sweat.
What It Is
The Closing Disclosure (Borrower) is a federally required, five-page document that provides the borrower with the final, exact terms and costs of their mortgage loan.
It includes:
Loan terms
Monthly payment breakdown
Closing costs
Cash to close
APR & finance charges
Comparisons to the Loan Estimate
Detailed disclosures
Think of it as the final receipt for the mortgage.
Why It Exists
The Closing Disclosure exists because of TRID (TILA-RESPA Integrated Disclosure) rules, designed to:
Protect consumers
Eliminate bait-and-switch lending
Increase transparency
Standardize disclosures nationwide
Before TRID, borrowers often discovered fees at the closing table. The CD forces lenders to show their cards before money changes hands.
Who Relies on It
This document isn’t just for the borrower.
Key stakeholders:
Borrowers (primary decision-makers)
Lenders (compliance + funding)
Title & escrow companies
Underwriters
Regulators (CFPB audits)
Attorneys (if disputes arise)
If something goes sideways, the Closing Disclosure is Exhibit A.
What Happens If It’s Wrong
Mistakes on a Closing Disclosure are not minor.
Depending on the error:
Closing may be delayed
Loan may require re-disclosure
Waiting periods may reset (3-day rule)
Lender may face compliance penalties
Borrower may refuse to sign
Funds may not disburse
APR errors alone can freeze funding instantly.
Common Mistakes
These are the issues that show up constantly:
Cash to Close does not match wire amount
Borrower name misspellings
Incorrect interest rate
Wrong loan term (30 vs 15)
Escrows shown incorrectly
Fees that don’t match the Loan Estimate
Seller credits missing or misapplied
APR tolerance violations
⚠️ Even a tiny discrepancy can require correction.
State Variants
The Closing Disclosure is federally standardized, but states may impact:
Additional riders or disclosures
Recording fee structures
Transfer taxes
Attorney vs title states
Who prepares the CD (lender vs settlement agent)
As a notary, you do not interpret state law—but you should expect extra state-specific disclosures alongside the CD.
Fraud Implications
The Closing Disclosure is a prime fraud target.
Common fraud schemes include:
Wire fraud (altered cash to close instructions)
Fake lender or title impersonation
Unauthorized fee changes
Identity manipulation
Because of this, many lenders:
Lock down last-minute CD changes
Verify funds verbally
Require secure portals for delivery
⚠️ Any unexpected changes must be escalated—never explained away.
Real-World Case
A borrower reviews the CD at the table and says:
“This says my interest rate is 7.125%, but I locked 6.75%.”
Result:
Signing stops
Lender confirms lock error
New CD issued
Funding delayed 3 days
Seller threatens cancellation
The notary didn’t cause the issue—but professional handling prevented a lawsuit.
Red Flags to Watch For
As a Notary Signing Agent, you’re not auditing—but you are observing.
Red flags include:
Borrower surprised by cash to close
Borrower says “this isn’t what I was told”
Interest rate confusion
Missing seller credits
Last-minute handwritten changes
Borrower wants you to “just explain it”
When in doubt: pause and escalate.
Execution Checklist (Notary Use)
Before presenting the CD:
✅ Confirm borrower name matches ID
✅ Confirm document is labeled “Closing Disclosure”
✅ Verify borrower signature lines
✅ Identify if borrower must sign acknowledgment
✅ Know who to call if questions arise
At the table:
✅ Present confidently
✅ Stay neutral
✅ Do not interpret numbers
✅ Allow borrower time to review
After signing:
✅ Confirm signatures completed
✅ Return per instructions
✅ Note any borrower concerns
📣 How to Explain It to the Signer 📣
“This is your Closing Disclosure. It outlines your final loan terms, monthly payment, and the exact amount needed to close. It’s meant to give you a clear financial snapshot before everything is finalized. You’ll want to review it carefully, and if anything looks different from what you expected, I can pause while you contact your lender or title company.”
Simple. Calm. Professional. No over-explaining.
⚡ Notary Signing Agent Power Notes ⚡
This is the most emotionally charged document in the package
Never rush a borrower through it
Silence is okay—review time builds trust
Never validate or invalidate numbers
Your composure = perceived competence
A clean CD presentation = fewer post-signing calls
Master this document and you instantly level up from order-taker to trusted professional.