Final answer:
Lenders are legally allowed to charge borrowers for the preparation of the Closing Disclosure form, but the costs must be reasonable.
Step-by-step explanation:
The preparation of the Closing Disclosure form is a service that lenders provide to borrowers in order to comply with federal regulations. The costs associated with preparing this form can vary depending on the lender and the complexity of the transaction. Under the Consumer Financial Protection Bureau (CFPB) regulations, the lender can charge the borrower for the actual costs of preparing the Closing Disclosure form, also known as the Loan Estimate, as long as these costs are reasonable and not excessive.