Question: We have an advertisement on our Web site and we also send out an e-mail advertisement that is the same as the Web site ad. Are these considered a single advertisement? If so, what are the obligations for each advertisement?
Multiple advertisements in any media, such as Web page advertisements on a Web site corresponding to a newsletter blast or in a catalog, are considered a single advertisement if the following criteria apply:
►A trigger term is used;
►Such term requires a table or schedule in order to provide information regarding a finance charge associated with the trigger term, or any other term is used that appears in the opening disclosures;
►The advertisement clearly and conspicuously sets forth or is required to set forth the foregoing table or schedule; and
►These advertisements are required to refer and/or provide access to such table or schedule.
Put otherwise, single advertisement guidelines apply for any advertisement where a statement of finance charge is required for a trigger term, or disclosure is required in opening disclosures for any other term, where the trigger term or other term appear in a catalog or advertisement, thereby requiring clear and conspicuous reference to the page or location where the mandated table or schedule begins. [12 CFR § 226.16(c)(1), 2010]
For instance, in any advertisement where a trigger term necessitates a statement of finance charge—indeed, any other term that appears in opening disclosures pursuant to Regulation Z § 226.6—the advertisement must clearly refer to the page, Web page, or any media location where a table or schedule is found and begins.
Therefore, in each online Web site ad and its corresponding newsletter ad, a hyperlink to the table or schedule containing required additional information should be provided for a trigger term requiring a statement of finance charge and/or any other term that appears in opening disclosures. [12 CFR Supplement I to Part 226 – Official Staff Commentary 12 CFR § 226.16(c)(1)-2, 2010]
Jonathan Foxx is managing director of Lenders Compliance Group, the first and only full-service, mortgage risk management firm in the United States, specializing exclusively in outsourced mortgage compliance and offering a suite of services in residential mortgage banking for banks and non-banks. Information contained in this article is not intended to be and is not a source of legal advice. If you would like to contribute a question, please submit it to [email protected].
This article originally appeared in the January 2017 print edition of National Mortgage Professional Magazine.