Regulation Z defines advertisements as commercial messages that promote, directly or indirectly, a credit transaction. This includes any medium, such as print, radio, television, or the internet. The advertisement must include a clear statement that the person making the announcement is not associated with or acting on behalf of the consumer's current lender. The disclosure must be equally prominent as the fees or payments that trigger it.
The announced annual percentage rate (APR) need not include a descriptive explanation and can be expressed by the abbreviation APR. In variable rate plan announcements, if the announced APR is based on the index and margin that will be used to make rate adjustments over the term of the loan, then there is no promotional rate or payment. When a third party or creditor wishes to promote reduced interest rates, the announced APR must be determined in accordance with § 1026.17 (c). Open credit ads should clearly indicate the time period in which discounted rates are in effect.
Regulation DD provides some options for this scenario by allowing a message explaining that rates may vary by term or account type. When advertising credit transactions, it is important to ensure that all required disclosures are included and are equally prominent as any fees or payments that trigger them. Additionally, open credit ads should clearly indicate the time period in which discounted rates are in effect.