Maryland Home Improvement PSI Practice Exam

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Prepare for the Maryland Home Improvement Test. Study using flashcards and multiple-choice questions, each with hints and explanations. Get ready to excel on your exam!

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Which Federal law regulates the advertisement of a lender's credit terms?

Real Estate Settlement Procedures Act.
ECOA.
Regulation Z.
Federal Fair Housing Act of 1968.

The correct answer is: Regulation Z.

Regulation Z, which is part of the Truth in Lending Act, specifically regulates the advertisement of a lender's credit terms. This regulation requires lenders to disclose key information clearly and accurately, ensuring that consumers are fully informed about the cost of credit and the terms associated with it. The goal is to promote transparency and help consumers compare credit offers from different lenders effectively. Under Regulation Z, any advertisement that specifies credit terms must include additional disclosures related to the APR (Annual Percentage Rate), any required fees, and other pertinent details that affect the total cost of borrowing. This regulation safeguards consumers by preventing misleading advertising practices that could result in financial harm or misunderstanding of loan agreements.