Do the credit ad rules apply to an HVAC company?
Yes. In the US, the advertising rules in Regulation Z (the Truth in Lending rules) apply to anyone who advertises consumer credit, not only the bank or finance company that makes the loan.
"Thus, home builders, merchants, and others who are not themselves creditors must comply with the advertising provisions of the regulation if they advertise consumer credit transactions." (CFPB: Official interpretation of 1026.2)
That covers ads, landing pages, truck wraps, mailers and social posts that mention financing for a furnace, AC, water heater or roof. The same rules apply to plumbers and roofers.
Which words are trigger terms?
For an installment loan (fixed payments over a set term), four kinds of statements trigger extra disclosures (12 CFR 1026.24(d)(1)):
| Trigger term | HVAC ad example | Triggers? |
|---|---|---|
| Down payment amount or percent | "Only $500 down" | Yes |
| Number of payments or repayment period | "60 monthly payments", "5-year financing" | Yes |
| Payment amount | "$99 a month" | Yes |
| Finance charge amount | "$300 total cost of credit" | Yes |
| No down payment | "No money down" | No |
| Vague terms | "Low monthly payments", "Financing available" | No |
| Rate alone | "0% APR" | No extra terms, but the APR rule applies |
The CFPB's official interpretation confirms the "No" rows: "no downpayment" does not trigger, and "monthly payments to suit your needs" is not a payment amount (CFPB: Official interpretation of 1026.24). A trigger also counts when it can be worked out from the ad, not only when stated outright (same source).
What must the ad add once it uses one?
All three of these, clearly and conspicuously:
"(i) The amount or percentage of the downpayment. (ii) The terms of repayment, which reflect the repayment obligations over the full term of the loan, including any balloon payment. (iii) The 'annual percentage rate,' using that term, and, if the rate may be increased after consummation, that fact." (12 CFR 1026.24(d)(2))
"APR" is an allowed abbreviation (CFPB: Official interpretation of 1026.24). A website can put the full terms in one table, if every financing claim elsewhere on the page clearly points to where that table is (12 CFR 1026.24(e)).
Can I just say "0% financing"?
Only if you state it as an annual percentage rate. Any rate in a credit ad must be called the "annual percentage rate" (or APR), and the ad must say if the rate can rise after the loan is signed (12 CFR 1026.24(c)). "0% APR financing" meets that. Add "for 60 months" or "$99 a month" and you are back in the trigger-term table above.
Every term you show must be one the lender will actually give: an ad "shall state only those terms that actually are or will be arranged or offered by the creditor" (12 CFR 1026.24(a)). If 0% is only for approved credit on certain systems, the ad cannot imply it is for everyone.
"No interest if paid in full" (deferred interest) offers
Some contractor programs run on a credit card or credit line, which is open-end credit under 12 CFR 1026.16. Ask your finance partner which kind your program is. If the offer waives interest only when the balance is paid off by a deadline, it is a deferred interest offer and has its own rule:
"If the phrase 'no interest' or similar term regarding the possible avoidance of interest obligations under the deferred interest program is stated, the term 'if paid in full' must also be stated in a clear and conspicuous manner preceding the disclosure of the deferred interest period in the advertisement." (12 CFR 1026.16(h)(3))
The ad must also say, near the first "no interest" claim, that interest is charged from the purchase date if the balance is not paid in full in time (12 CFR 1026.16(h)(4)). The CFPB's sample wording for a credit card plan:
"Interest will be charged to your account from the purchase date if the purchase balance is not paid in full within the/by [deferred interest period/date] or if you make a late payment." (CFPB: Regulation Z Appendix G, Sample G-24)
For an open-end plan, a payment amount for a named product also forces the total of payments and the payoff time, shown as prominently as the payment (12 CFR 1026.16(b)(2)).
Is it different in Canada?
Yes. There is no Regulation Z; credit ads fall under provincial consumer protection law. Ontario's rule is in O. Reg. 17/05, section 61, and like the US rule it covers anyone who makes credit representations in an ad, not only lenders.
- An ad for fixed credit that shows an interest rate or a payment amount must also show the APR and the length of the term. When the seller or an associate of the seller gives the credit for a named product (a supplier credit agreement), the cash price is added.
- That applies even when the rate or payment shown is zero.
- The APR must be as prominent as the most prominent rate or payment in the ad.
- An ad saying no interest is payable for a period must say whether it is truly interest-free or interest is forgiven only if conditions are met, and if so, the conditions and the rate that applies if they are not met.
"Subsection (2) applies even if the advertisement discloses that the interest rate payable by the borrower or the amount of a payment to be made by the borrower to the lender is zero." (Ontario O. Reg. 17/05, s. 61(3))
This page covers Ontario only. Check your own province's consumer protection law before advertising financing there.
Example
A Google ad with a monthly payment (US)
Headline: "New AC from $150/month". That is a payment amount, so the ad needs the down payment, the repayment terms and the APR, for example: "$0 down, 60 monthly payments of $150 on a $9,000 system, 0% APR, on approved credit." A short ad that cannot fit this can drop the payment and say "Financing available" instead.
A deferred interest promotion (US)
Banner: "No interest for 12 months." That must read "No interest if paid in full within 12 months," with the sentence that interest is charged from the purchase date if the balance is not paid in full in time placed close by.
A furnace ad in Ontario
"$0 a month until spring" for a $6,000 furnace names a zero payment, so the ad still needs the APR and the length of the term. If it is a supplier credit agreement, it also needs the $6,000 cash price.
Different for you?
- Advertising mortgages or home equity loans: Mortgage advertising trigger terms.
- Writing the HVAC search ads themselves: Google Ads for plumbers and HVAC.
- The page your financing ad lands on: Landing page for Google Ads.
- Planning spend around the heating and cooling seasons: HVAC, roofing and plumbing marketing budget.