Required by federal law and discloses the cost of the loan, the annual percentage rate, whether there is a prepayment penalty, and the number and amount of all payments necessary to repay the loan.
A legally required document that shows the loan amount, interest rate, required payments, and total amount of interest that will be paid over the life of the loan. This document is required to be provided to the borrower before the mortgage transaction is signed. In a purchase transaction, this document is required to be provided to the borrower within three days of the date of application. In other types of loans (e.g. refinances, second mortgages, etc.), it is ordinarily provided to the borrower at the loan closing. This document is intended to translate the legalese of the Note and Deed of Trust into understandable terms for comparison-shopping, to understand loan costs, and to understand the type of loan, length of loan, and payment schedule.