What type of lender is defined as an institution regulated by law for loan practices?

An institutional lender is defined as an organization that is regulated by government authorities and laws regarding loan practices. This includes banks, credit unions, and other financial institutions that are authorized to provide loans in adherence to specific regulations that ensure consumer protection and fair lending practices. Because these lenders are monitored by regulatory bodies, they must comply with various standards and practices designed to maintain financial stability and protect borrowers, making them a reliable source of financing.

In contrast, the other options refer to entities that do not have the same level of regulatory oversight. Private investors may lend funds but are generally individuals or entities acting independently of regulatory guidelines. Mortgage bankers are typically involved in originating and servicing loans but may not fall under the same regulations as institutional lenders. The term "additional lender" does not specify a particular type of lending institution and is too vague to be relevant in this context. Thus, the correct identification of institutional lenders as those regulated by law provides a clear understanding of their role in the lending landscape.