When must a loan estimate be delivered after a loan application?

A loan estimate must be delivered within three business days after a borrower submits a loan application. This requirement is set by the Truth in Lending Act, which aims to provide borrowers with key information about the terms and costs of their mortgage, allowing them to make informed decisions.

The three-day timeframe is critical as it ensures that the borrower has enough time to review the loan terms and determine whether to proceed with the application. Additionally, this regulation helps promote transparency and protects consumers from potential surprises regarding fees and interest rates.

The other choices reference timeframes that do not comply with the established regulation. Specifically, two business days would not allow sufficient time for the lender to prepare the comprehensive estimate. Five business days exceeds the mandated timeframe, and delivering the estimate before the application is approved fails to align with the objective of providing borrowers with crucial information right after their application has been submitted.