What is the primary role of closing disclosure in real estate transactions?

The closing disclosure plays a crucial role in real estate transactions as it summarizes the final terms of the mortgage and the associated costs involved in the purchase of a property. This document is essential because it provides the borrower with a clear and comprehensive breakdown of all loan terms, including the loan amount, interest rate, monthly payments, and any closing costs that must be paid at the time of the transaction.

Having this information laid out in a summary format ensures that the buyer can make informed decisions and understand exactly what financial obligations they are committing to before finalizing the purchase. It also serves to promote transparency and protect the interests of both the borrower and the lender by ensuring that both parties are aware of the financial specifics involved in the deal.