What does a borrower receive upon signing the Loan Estimate?

When a borrower signs the Loan Estimate, they receive a confirmation of the terms of the mortgage loan they are applying for. The Loan Estimate is a standardized form that provides essential information about the loan's terms, including the interest rate, monthly payments, and total closing costs. This document is intended to help borrowers understand their options and compare different loan offers.

The purpose of the Loan Estimate is to ensure transparency and that borrowers are fully informed about the financial obligations they are considering. By confirming these terms, the borrower can make an educated decision about whether to proceed with the loan or seek alternatives.

The other options do not accurately describe the nature of the Loan Estimate. Final approval of the loan comes after all the underwriting processes have been completed, which occurs after the Loan Estimate is provided. A detailed closing statement is a document that is finalized at closing, summarizing all costs and payments. Lastly, the application form is just the initial paperwork and does not provide any specific terms related to the loan.