Finance
Under Regulation Z (Truth in Lending), which disclosure must a Minnesota lender make for a closed-end mortgage?
AThe appraiser's opinion of value
BThe Annual Percentage Rate (APR) and total finance charge✓ Correct
CThe seller's net proceeds from the transaction
DThe real estate commission paid to agents
Explanation
Regulation Z (implementing the Truth in Lending Act) requires lenders to disclose the APR (Annual Percentage Rate) and total finance charge for closed-end consumer credit including mortgages. These disclosures allow Minnesota borrowers to compare the true cost of different loan options. The APR is higher than the nominal interest rate because it includes fees and other finance charges.
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