Texas Real Estate Brokerage Sales Apprentice Education (SAE) Practice Exam

Which of the following allows lenders to track lending patterns in various communities?

1. Consumer Credit Protection Act

2. Housing Expense Disclosure Act

3. Home Mortgage Disclosure Act

4. Fair Lending Act

The correct answer is: Home Mortgage Disclosure Act

The Home Mortgage Disclosure Act is the correct choice because it was specifically enacted to provide the public and government regulators with information about how financial institutions lend to various communities. This act requires lenders to collect and report data on mortgage applications, approvals, and denials, and this information is used to ensure compliance with fair lending laws and to identify patterns in lending that could indicate discrimination or other issues. By making this data publicly available, stakeholders are able to observe lending trends in different geographic areas, which can highlight disparities and lead to informed policy decisions aimed at promoting fair lending practices. In contrast, while other acts like the Consumer Credit Protection Act, Housing Expense Disclosure Act, and Fair Lending Act address important aspects of consumer finance and equal lending, they do not specifically focus on the systematic reporting and analysis of mortgage lending patterns within communities like the Home Mortgage Disclosure Act does.