What is the time frame for a lender to provide a loan estimate to a buyer after a loan application?

The correct time frame for a lender to provide a loan estimate to a buyer after a loan application is indeed three business days. This requirement is outlined in the Real Estate Settlement Procedures Act (RESPA) and the Truth in Lending Act (TILA), which mandate that lenders must deliver or make a loan estimate available to borrowers within three business days of receiving a loan application.

This stipulation is designed to ensure borrowers have timely access to key information regarding the terms and costs of their potential mortgages, allowing them to make informed decisions as they navigate the home-buying process. The loan estimate includes crucial details such as the interest rate, monthly payment amounts, and estimated closing costs, providing a clear picture of the financial commitments involved.

In contrast, other time frames presented do not align with federal regulations. Understanding this three-business-day timeline is essential for both lenders and buyers to ensure compliance and facilitate a smooth transaction process.