Finance
What is the 'Truth in Lending Act' (TILA) and how does it protect Hawaii borrowers?
AA. A law requiring sellers to disclose all known property defects
BB. A federal law requiring lenders to clearly disclose loan terms, APR, and total cost of credit to borrowers before closing✓ Correct
CC. A Hawaii state law regulating mortgage broker fees
DD. A law requiring lenders to approve loans within 30 days
Explanation
TILA (Regulation Z) requires lenders to disclose key loan terms including the Annual Percentage Rate (APR), finance charges, amount financed, and total of payments. These disclosures help borrowers compare loan offers and understand the true cost of borrowing, protecting against predatory lending.
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