What term describes the funds provided by the lender at settlement?

The term that best describes the funds provided by the lender at settlement is "Funding." This refers to the actual transfer of money from the lender to the borrower or to the appropriate parties involved in the transaction at the closing of the loan. When the funding occurs, it signifies that the lender has fulfilled its obligation to provide the financial resources necessary for the borrower to purchase the property.

Funding is an essential step in the mortgage process, as it marks the moment when the borrower receives the actual loan proceeds, enabling them to complete the transaction. This critical function ensures that the seller receives payment and the buyer can take ownership of the property.

In contrast, financing generally refers to the process of obtaining funds, which encompasses more than just the act of disbursing money at settlement. Disbursement is more specific and often associated with the distribution of funds within a broader financial context, such as loan proceeds to various parties. Capitalization, on the other hand, pertains to the funding of assets or projects and is not specifically connected to the immediate transfer of funds at closing in a mortgage context.