Affiliate Broker Tennessee (TN PSI) National Practice Exam `

When is a Closing Disclosure provided to a buyer?

1. Within 48 hours before closing

2. One week before closing

3. At the time of the inspection

4. On the closing day itself

The correct answer is: Within 48 hours before closing

The Closing Disclosure is a critical document in real estate transactions that outlines the final terms and costs associated with the loan and the purchase of the property. It is required by law to be provided to the borrower, which is typically the buyer, at least three business days before closing. This timeframe allows the buyer adequate opportunity to review the document, understand the financial obligations, and ask any questions before finalizing the transaction. Providing the Closing Disclosure within 48 hours before closing aligns closely with the legal stipulations that aim to protect consumers and ensure transparency in the transaction process. By delivering this document just before the closing date, the buyer is better prepared and can come to the closing table with all necessary information regarding their financial commitments. The other options do not comply with regulatory requirements or common practices in real estate transactions. One week before closing might offer too much time for potential changes that would not be accurately reflected in the Disclosure. Providing it at the time of inspection or on the closing day itself would not give the buyer the mandated time to review the information, which is essential for making informed decisions. Thus, the answer regarding the appropriate timing for delivering the Closing Disclosure is accurately reflected as within 48 hours before closing.