Final answer:
A lender's fiduciary duty to a borrower includes commitment to loyalty and care, rather than offering investment advice, legal representation, or the highest possible interest rates. Banks are regulated by the Federal Reserve to ensure compliance with consumer protection laws, including anti-discrimination measures and the transparency of their loan practices. The correct option is a) Investment advice
Step-by-step explanation:
The fiduciary duty of a lender to a borrower typically involves providing loyalty and care. This responsibility does not encompass offering investment advice or legal representation, nor does it entail setting the highest interest rates. Instead, the lender must act in the best interests of the borrower, with a duty to provide transparency and fair treatment in accordance with consumer protection laws.
The Federal Reserve plays a crucial role in ensuring that banks comply with these consumer protection laws. Banks are required to avoid discriminatory practices based on age, race, sex, or marital status and must provide clear information about their loan distribution, including details related to house-buying loans geographically and across different demographics.
In addition, to reassure a bank considering a loan application, a borrower might show their creditworthiness, provide collateral, propose a sound business plan, or suggest a co-signer as some of the ways to demonstrate their reliability in repaying the loan. The correct option is a) Investment advice