Which law requires mortgage lenders to provide a Loan Estimate?

The Truth in Lending Act (TILA), as amended by the Dodd-Frank Act, is the law that requires mortgage lenders to provide a Loan Estimate to borrowers. The Loan Estimate is a key document that provides important information about the terms of a mortgage loan, including the loan amount, interest rate, projected monthly payments, and estimated closing costs.

This requirement aims to promote transparency and enable borrowers to compare the costs and terms of various loan offers. By ensuring that borrowers receive this information early in the application process, the law helps them make informed decisions regarding their borrowing options.

Other laws mentioned in the options have different focuses. The Fair Housing Act addresses discrimination in housing, the Equal Credit Opportunity Act prohibits credit discrimination, and the Home Ownership and Equity Protection Act provides protections for high-cost mortgages. While all these laws play essential roles in consumer protection in the mortgage industry, it is the Truth in Lending Act that specifically mandates the issuance of the Loan Estimate.