Banks and other lenders are required to disclose a rate called the APR. What is this rate?Why did Congress require that it be disclosed? Is it the same as the effective annual rate? Ifyou were comparing the costs of loans from different lenders, could you use their APRs todetermine the loan with the lowest effective interest rate? Explain.
Mortgages
A mortgage is a formal agreement in which a bank or other financial institution lends cash at interest in return for assuming the title to the debtor's property, on the condition that the obligation is paid in full.
Mortgage
The term "mortgage" is a type of loan that a borrower takes to maintain his house or any form of assets and he agrees to return the amount in a particular period of time to the lender usually in a series of regular equally monthly, quarterly, or half-yearly payments.
Banks and other lenders are required to disclose a rate called the APR. What is this rate?
Why did Congress require that it be disclosed? Is it the same as the effective annual rate? If
you were comparing the costs of loans from different lenders, could you use their APRs to
determine the loan with the lowest effective interest rate? Explain.
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