Which statement will you receive?
For most financed home purchases, the lender provides a Closing Disclosure explaining the loan and transaction costs. It generally must reach you at least three business days before closing. Cash transactions and some other loan types use different settlement documents. The title company may also prepare an itemized settlement statement.
The entries that matter most
| Entry | What to check |
|---|---|
| Purchase price | Matches the contract and signed changes. |
| Deposit | Your escrow deposit appears as money already paid, reducing the balance due. |
| Loan funds | Loan proceeds are a funding source, not an extra purchase charge. |
| Lender fees and points | Compare with the Loan Estimate and agreed loan terms. |
| Title and settlement charges | Identify insurance premiums, closing services and any related charges; confirm who pays under the contract. |
| Prepaid expenses | May include advance insurance premiums or interest; these differ from service fees. |
| Initial lender escrow | Funds set aside for future taxes and insurance, separate from your earnest-money deposit. |
| Prorations and credits | Adjust taxes, dues and agreed concessions between buyer and seller. |
| Cash to close | The remaining amount you must supply after loan funds, deposits and credits. |
Closing costs are not the same as cash to close
Cash to close includes the remaining down payment and applicable transaction costs, less amounts already paid and other credits. A simplified example: a $500,000 purchase with a $400,000 loan, $12,000 of buyer costs and a $10,000 deposit leaves $102,000 to bring, before any additional credits or prorations. Actual statements may show adjustments in separate sections.
Understand tax prorations
A credit for taxes the seller has not yet paid can compensate the buyer for the seller’s share of a later bill. The contract controls the calculation and any later adjustment. The proration does not set the buyer’s future tax rate or assessed value.
Seller proceeds
For a seller, review the price, mortgage and lien payoffs, agreed compensation, title and transfer charges, buyer credits and prorations. Confirm payoff dates and daily interest. The net proceeds are the amount remaining after these obligations and adjustments.
Before signing
Check names, property address, price, deposit credit and final funds required. Ask the lender about loan terms and the title company about settlement entries. Verify payment instructions directly with the closing company using a previously confirmed telephone number.
CFPB Closing Disclosure explainer and sample
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