When you apply for a mortgage, you receive a Loan Estimate within three business days. Three business days before closing, you receive the Closing Disclosure. These two documents are designed to be compared — and knowing the differences between them can save you real money.
What is a Loan Estimate?
The Loan Estimate (LE) is a three-page standardized form that your lender must give you within three business days of receiving your mortgage application. It shows the estimated terms of your loan: the interest rate, monthly payment, total closing costs, and projected payments over the life of the loan.
The key word is estimated. At application time, the lender does not yet have complete information about your financial situation, the specific property, or third-party service providers. The numbers on the Loan Estimate are good-faith estimates — but they can change.
The Loan Estimate sets expectations and lets you compare offers from multiple lenders. The interest rate, origination charges, and monthly payment shown on Page 1 are the numbers most buyers focus on — but the closing costs on Page 2 are equally important and often more variable.
What is a Closing Disclosure?
The Closing Disclosure (CD) is the final version of the Loan Estimate. It is a five-page form that shows the exact, locked-in costs of your mortgage. Your lender must deliver it at least three business days before closing — this is the mandatory TRID waiting period.
The CD contains the same categories of information as the LE, but with final figures. It also includes additional detail: a breakdown of all costs paid by the buyer, seller, and lender; the exact cash to close; and the complete loan calculation showing total interest paid over the life of the loan.
The 3-Day Rule
Federal law (the TRID rule, which stands for TILA-RESPA Integrated Disclosure) requires lenders to give borrowers at least three business days to review the Closing Disclosure before closing. This waiting period is mandatory — a closing cannot proceed without it.
If the lender needs to send a revised CD (because the APR changes by more than 0.125%, the loan product changes, or a prepayment penalty is added), the three-day clock resets. This means closing can be delayed.
Use the three-day period. Do not simply show up at closing and sign without comparing the CD against your original Loan Estimate.
Which Fees Can Change? TRID Tolerance Categories
Not all fees have the same rules. TRID divides closing costs into three tolerance categories:
Category A: Zero tolerance — cannot increase at all
These fees are locked in from the Loan Estimate. Any increase is a TRID violation that the lender must cure:
- Origination charges (lender fees, origination points, underwriting fees)
- Discount points (if the rate was locked)
- Transfer taxes
- Fees for required third-party services where the borrower was not given a choice of provider
Category B: 10% tolerance — can increase up to 10% in aggregate
These fees can change, but only within a 10% cushion across the entire category. Individual fees can increase more as long as the total stays within 10%:
- Recording fees
- Required third-party services where the borrower chose from a lender-provided list (title settlement, pest inspection, survey)
Category C: No tolerance limit — can change freely
These items are estimates only and often change between the LE and CD:
- Prepaid interest (depends on exact closing date)
- Property insurance premiums (buyer chooses insurer)
- Escrow impounds (amount depends on actual tax and insurance figures)
- Third-party services where the borrower chose a provider not on the lender's list
What to Do If Numbers Changed
When you receive your Closing Disclosure, compare it line by line against your Loan Estimate. Pay special attention to:
- Interest rate — should not change unless you have a floating rate
- Origination charges — zero tolerance; any increase is a violation
- Monthly payment — should match unless loan terms changed
- Total closing costs — compare Category A and B fees carefully
- Cash to close — this often changes due to Category C items; understand why
If you spot a Category A fee increase, contact your lender immediately and ask for an explanation and a corrected CD if warranted. Lenders are required to cure TRID tolerance violations before or at closing — typically by a lender credit that reduces your closing costs.
Use the LE vs CD verification tool to compare your documents side by side and automatically flag any fee changes that may violate TRID tolerances.
Extract your Closing Disclosure in seconds
Upload your CD PDF and get every field extracted instantly — then compare it against your Loan Estimate to catch discrepancies before you sign.