Which document must lenders provide to borrowers under the Mortgage Disclosure Improvement Act?

Under the Mortgage Disclosure Improvement Act (MDIA), lenders are required to provide borrowers with a Loan Disclosure, commonly referred to as the Loan Estimate. This document is crucial as it outlines the key terms and costs of the loan, giving borrowers the necessary information to make informed decisions. The Loan Estimate must be provided within three business days of receiving a loan application, ensuring that borrowers have a clear understanding of their financial responsibilities before finalizing their mortgage.

The Loan Disclosure is designed to promote transparency and protect consumers by detailing important aspects such as the estimated monthly payments, interest rate, and closing costs. This requirement helps borrowers compare different loan options more effectively, allowing them to choose the financial product that best meets their needs.

On the other hand, while the Loan Agreement, Mortgage Application, and Property Deed are important documents in the mortgage process, they do not fulfill the specific requirements set forth by the MDIA for disclosure. The Loan Agreement is the contract between the lender and borrower, detailing the terms once the loan is finalized. The Mortgage Application is the initial information gathering form, and the Property Deed signifies ownership of the property but does not provide the financial disclosures mandated by the MDIA. Thus, the Loan Disclosure is the correct requirement outlined by this act.