Did you buy a house this past year? Your Closing Disclosure becomes more important during tax season. This is because it tells you about your loan's financials, and there are specific tax benefits you can take advantage of come tax time. 

Here are some things that you should know:

What is a closing disclosure?

When you're ready to close on your home or refinance, the closing disclosure is going to be the final accounting of the dollars and cents for you to review before signing your final mortgage paperwork at your closing. Once you've reviewed and approved your closing disclosure, you're ready to complete the mortgage process, close your loan and get the keys to your home or finish your refinance.

The closing disclosure, also known as a closing statement, is a five-page legal document that details the final terms of the mortgage loan you're about to borrow. You'll find information about your interest rate, closing costs, the terms of your loan and many other valuable pieces of information about your mortgage.

Why your closing disclosure is important

When you apply for a loan, you're entering into a legal contract with the lender. This contract includes a closing disclosure that contains important information about your loan and its terms. A closing disclosure gives you one last opportunity to make sure you're comfortable borrowing based on the terms of the loan you originally applied for. It also holds the lender accountable for the accuracy of its initial quotes and, in some cases, requires the lender pay out of its pocket for fees that weren't properly disclosed.

Where to Get Copies?

Real estate agents can provide you with copies of all your closing documents.

If you're buying a home, your realtor will keep a file on the buyer and seller. This file should include all the paperwork associated with the transaction, including financial and legal documents. If you're selling a home, your realtor will also keep a file on the buyer and seller.

Your real estate agent or transaction coordinator will be able to provide you with digital copies of most of these documents--including contracts--so they can easily be stored on your computer or on a storage drive.

To our dsmSOLD past clients in 2022 - we are sending out a copy of your closing statements through your email. Make sure you take this to your accountant when you do your taxes! This will detail out any interest you paid at closing that can be tax deductible in addition to other items they may be able to claim as deductions. You will get one of the following documents from us for tax purposes - either an ALTA statement or a Closing Disclosure. Below we have pictured an example form so you know what each looks like.

ALTA SETTLEMENT STATEMENT

CLOSING DISCLOSURE

Have questions about your Closing Disclosures? Let us know in the comments.