Final answer:
Regulation Z, or the Truth in Lending Act, applies to various consumer loans including those for purchasing cars and real estate for personal use. It requires clear disclosure of loan terms and costs to consumers. Commercial loans and transactions above certain thresholds may not be covered.
Step-by-step explanation:
Loans covered by Regulation Z include:
- A loan to purchase a $20,000 car
- A purchase money mortgage for $125,000 for the purchase of a duplex
- A loan for $375,000 made to purchase a farm
- A loan of $215,000 to a builder for the construction of a single-family residential home
Regulation Z, also known as the Truth in Lending Act (TILA), applies to certain consumer credit transactions, including loans for purchasing automobiles and real estate for personal use. It requires lenders to provide clear and conspicuous disclosure about the terms and costs of loans to enable consumers to compare credit terms freely and knowledgeably. It does not generally apply to commercial loans or credit transactions above certain thresholds. For example, loans made to acquire or improve real property, such as a farm or business construction, may not fall under Regulation Z if they exceed the set financial thresholds or are for business purposes.