Disbursement
The release and distribution of loan funds at closing to the parties entitled to receive them.
At closing, the lender wires the loan proceeds to the settlement agent (usually a title company or closing attorney), who then disburses funds according to the Closing Disclosure: the seller's net proceeds, the existing mortgage payoff, real estate commissions, county recording fees, title insurance premiums, and any other authorized payees.
Most states require the settlement agent to disburse on the day of closing, but a handful operate as dry-funded, meaning documents are signed one day and funds disburse the next business day after final review. Your loan officer can tell you which model applies in your jurisdiction.
Once disbursement happens and the deed and mortgage are recorded at the county, the transaction is officially complete. The borrower owns the home, the lender holds the lien, and you can change the locks.
Related terms
Other terms you'll see alongside Disbursement
The final step of a real estate purchase or refinance where loan documents are signed and ownership or lien position transfers.
The fees paid to the title company or attorney handling the closing, including title services and recording.
The total amount of money the borrower must bring to the closing table in certified funds.
The five-page final-numbers document a lender must deliver to the borrower at least three business days before closing.
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