Final answer:
Lenders must provide a good faith estimate of settlement costs under RESPA within three business days of receiving a completed application. This helps consumers understand mortgage costs and compare offers.
Step-by-step explanation:
Under the Real Estate Settlement Procedures Act (RESPA), lenders are required to provide a good faith estimate of settlement costs to applicants within three business days after the lender receives a completed application. This good faith estimate is meant to help consumers compare different offers and understand the true costs associated with their mortgage before closing. Also, under RESPA, lenders must provide a Settlement Statement (HUD-1) at least one day prior to settlement, detailing all actual costs of the transaction.