When must a loan estimate be provided to a borrower?

A loan estimate must be provided to a borrower after a loan application is made. This requirement is set forth by federal regulations, specifically under the Truth in Lending Act and the Real Estate Settlement Procedures Act. The loan estimate outlines the terms of the loan, estimated monthly payments, and the closing costs. This document is essential as it allows borrowers to understand the financial implications of the loan before making a commitment, enabling them to compare different lending options. By ensuring that the loan estimate is given promptly following the loan application, lenders facilitate a transparent and informed borrowing process. This timing helps to protect consumers and promotes responsible lending practices.