What must a lender provide to a borrower concerning the loan terms after they complete a loan application?

The lender is required to provide a disclosure of the Annual Percentage Rate (APR) to the borrower after they complete a loan application. This requirement is rooted in the Truth in Lending Act (TILA), which mandates that lenders disclose clear and accurate information about the cost of credit. The APR is a critical figure because it represents the total cost of borrowing on an annual basis, including both the interest rate and any associated fees.

Providing this information allows borrowers to make informed comparisons between different loan offers and understand the true cost of financing. The APR is designed to provide a more complete picture of what a borrower can expect to pay over the life of the loan, beyond just the nominal interest rate. This transparency enhances consumer protection in the lending process and fosters informed decision-making by borrowers.

In contrast, while pre-approval letters, credit reports, and loan payoff statements are relevant financial documents in the lending process, they do not specifically fulfill the requirement set forth by TILA regarding post-application disclosures related to loan terms.