What must a lender do when the exact information necessary to prepare the LE is not known at the time?

When preparing a Loan Estimate (LE), if a lender does not have the exact information required at that moment, they must estimate based on their experience and the best available information. This approach helps ensure that borrowers receive a timely estimate of their loan costs and terms, which is crucial for informed decision-making.

Estimating allows the lender to provide figures that may be subject to change but still give the borrower a reasonable expectation of potential costs. It's important for the estimation process to be as accurate as possible to avoid significant discrepancies once the final figures are known. This practice aligns with the spirit of the Truth in Lending Act (Regulation Z), which aims to promote transparency and fair lending practices.

In contrast, leaving information blank would not provide the necessary transparency to the borrower regarding loan costs, while using default information might not accurately reflect the actual terms applicable to the specific borrower. Waiting until all exact information is available could delay the process unnecessarily and is not in line with the timely dissemination of information that Regulation Z requires.