When must the borrower sign the Loan Estimate according to the Real Estate Settlement Procedures Act?

The correct approach regarding the signing of the Loan Estimate under the Real Estate Settlement Procedures Act (RESPA) is that there is no requirement for the borrower to sign the Loan Estimate at all. Instead, the lender must provide the Loan Estimate to the borrower within three business days of receiving the loan application. This document is intended to give borrowers a clear understanding of the estimated costs associated with the mortgage and to help them make informed decisions about their loan options.

While lenders are required to deliver the Loan Estimate promptly, borrowers do not need to sign or return it as a condition for their loan. The Loan Estimate serves as a written disclosure that outlines terms, estimated payments, and costs, allowing borrowers to compare offers from different lenders. Its purpose is to promote transparency and assist in the decision-making process, rather than requiring a formal acknowledgment through a signature.