Oregon 30-Hour Real Estate Law Practice Test

In a real estate transaction, when is the final closing disclosure typically provided to the buyer?

1. Before the loan application

2. At the time of the appraisal

3. Three days before closing

4. On the day of closing

The correct answer is: Three days before closing

The final closing disclosure is typically provided to the buyer three days before closing to ensure that the buyer has adequate time to review the terms of the mortgage and the costs associated with the transaction. This timeline is mandated by the TILA-RESPA Integrated Disclosure Rule (TRID), which was implemented to protect consumers and promote transparency in the mortgage process. By delivering the final closing disclosure three days in advance, buyers have the opportunity to compare the final terms with their Loan Estimate and address any discrepancies or questions they might have prior to the closing meeting. This is crucial for informed consent and understanding of their financial commitments. Other stages in the transaction, such as before the loan application or on the day of closing, do not allow sufficient time for the buyer to evaluate these important documents, potentially leading to confusion and unexpected costs.