Which law ensures lenders use an annual percentage rate (APR) so that borrowers have the information they need to make informed comparisons?

Regulation Z is the correct answer because it was established under the Truth in Lending Act (TILA) to ensure that consumers are provided with clear and accurate information about the costs associated with borrowing. A key component of Regulation Z is the requirement that lenders disclose an annual percentage rate (APR) for loans, which includes interest rates and certain fees expressed as a single percentage. This standardization allows borrowers to easily compare loan offers from different lenders and understand the total cost of borrowing, thereby making more informed financial decisions.

The purpose of showing the APR is to provide borrowers with a holistic understanding of the expenses linked to a loan, facilitating a transparent comparison across various loan products. By mandating this transparency, Regulation Z serves to protect consumers from deceptive lending practices.

The other options pertain to different aspects of lending regulations. The Equal Credit Opportunity Act focuses on preventing discrimination in lending based on race, color, religion, national origin, sex, marital status, or age. Regulation X relates to the Real Estate Settlement Procedures Act (RESPA), which governs disclosures in real estate transactions, particularly concerning closing costs and services. The Fair Housing Act addresses discrimination in housing-related transactions, ensuring that all individuals have equal access to housing regardless of protected characteristics. Each of these serves