Which of the following is a key disclosure required by the Truth in Lending Act (TILA)?
Correct Answer
B) Annual Percentage Rate (APR)
The Truth in Lending Act (TILA) requires lenders to disclose the Annual Percentage Rate (APR), which reflects the true cost of borrowing by including the interest rate plus fees and other charges. This disclosure helps consumers compare loan products on an equal basis.
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Related Topics & Key Terms
Related Topics:
Key Terms:
Related Concepts
Foreclosure is the legal process by which a lender takes possession of a property when a borrower fails to make mortgage payments. It allows the lender to sell the property to recover the outstanding debt.
The loan-to-value ratio (LTV) is the percentage of a property's appraised value or purchase price (whichever is lower) that is being financed through a mortgage. LTV = Loan Amount / Property Value.
A comparison of the major mortgage loan types—conventional, FHA, VA, and USDA—covering their eligibility requirements, down payment amounts, mortgage insurance rules, and best use cases.
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