TRID – Closing Disclosures & “3 Day Review” Period Explained

signing-closing-disclosureThis blog is one of the most viewed pages on our website, so I thought I’d update it and send it out again b/c there is clearly a lot of interest.

People always want to know the exact day we can close when we prepare a Closing Disclosure (CD) and send loan documents to title.

As a reminder, a CD is a form that sets out all of the updated fees and terms associated with a borrower’s loan.

Lenders can prepare CDs relatively early in the loan process, but they need to make sure the appraisal and insurance are approved by underwriting, and they need to make sure all of the terms and fees are final and accurate.

If any fees are added after CD, a new CD may need to be issued, potentially starting a new waiting period.

A CD is typically sent electronically for the borrower’s e-signature.

Borrowers cannot sign loan documents until three business days have passed from the date of the CD acknowledgment (or e-signing).

If the CD is acknowledged on a Thursday, for example, the borrower can sign loan docs on the following Monday; Friday would be Day #1; Saturday would be Day #2; and Monday would be Day #3 (borrower can sign on Day #3).

The table below sets out the acknowledgment and earliest possible signing days.

ACKNOWLEDGEDCAN SIGN
MondayThursday
TuesdayFriday
WednesdaySaturday
ThursdayMonday
FridayTuesday

Lastly, federal holidays and Sundays do not count as business days.

And, we typically fund loans the day after a borrower signs loan documents, but we can also fund on the same day if necessary.

Jay Voorhees at (925) 855-4491
Real Estate Broker, CA Department of Real Estate, DRE# 01524255, NMLS# 335646