Which federal law obliges loan originators to provide a Loan Estimate within three days of application?

The correct answer is the TILA-RESPA Integrated Disclosure (TRID), which is a regulation that was implemented to streamline the disclosure process for consumers and enhance transparency. Under this regulation, loan originators are mandated to provide a Loan Estimate to borrowers within three business days after they submit their mortgage application. This Loan Estimate outlines key loan terms and projected payments, as well as details about closing costs, helping borrowers to make informed decisions in a more timely manner.

The Truth in Lending Act and the Real Estate Settlement Procedures Act, while related to consumer protection in lending and the real estate transaction process, do not specifically require the Loan Estimate to be provided within three days of application. Instead, these acts establish broad parameters for disclosure but do not integrate the requirements in the manner that TRID does. The Fair Housing Act focuses on preventing discrimination in housing and lending practices, which is a different area of consumer protection and does not pertain to the timing of loan estimates.

Thus, TRID is specifically designed to ensure that borrowers receive crucial information about their loans early in the application process, promoting better understanding and enabling comparison-shopping amongst loan products.