The rule: one trigger term brings three disclosures
"If any of the following terms is set forth in an advertisement, the advertisement shall meet the requirements of paragraph (d)(2) of this section: (i) The amount or percentage of any downpayment. (ii) The number of payments or period of repayment. (iii) The amount of any payment. (iv) The amount of any finance charge." (12 CFR 1026.24(d)(1))
Once a trigger appears, the same ad must state the down payment, the repayment terms over the full loan (including any balloon payment), and the "annual percentage rate," using that term, plus the fact that the rate may rise if it can (1026.24(d)(2)). Disclosures must be "clear and conspicuous" (1026.24(b)).
Trigger terms for mortgage advertising: examples
The CFPB's official interpretation gives these examples (CFPB: comment 24(d)(1)):
| Trigger | Triggers | Does not trigger |
|---|---|---|
| Down payment | "Only 5% down," "As low as $100 down" | "No downpayment" |
| Number of payments or term | "30-year mortgage," "48-month payment terms" | "Pay weekly," "take years to repay" |
| Payment amount | "$500,000 loan for just $1,650 per month" | "Monthly payments to suit your needs" |
| Finance charge | "$50,000 mortgages, 2 points to the borrower" | "No closing costs," a stated APR |
One limit: the commentary says the down-payment trigger "is limited to credit sale transactions," such as a seller financing the home it sells (comment 24(d)(1)-1). For a lender's or broker's loan ads, the term, payment and finance-charge triggers are the ones that apply.
Who must follow it: agents and builders too
"All persons must comply with the advertising provisions in §§ 1026.16 and 1026.24, not just those that meet the definition of creditor in § 1026.2(a)(17)." (CFPB: comment 2(a)(2)-2)
The same comment names "home builders, merchants, and others." A listing agent's flyer that says "$2,400 a month" is covered.
Stating a rate
If an ad states a rate of finance charge, it must state it as an "annual percentage rate," using that term (1026.24(c)). For a home loan, the only other rate allowed is the simple interest rate, shown "in conjunction with, but not more conspicuously than, the annual percentage rate."
Home-loan ads have extra rules (1026.24(f)), except on TV and radio:
- More than one rate over the loan (an ARM or teaser): show each rate, how long it applies, and the APR, with equal prominence and close to the advertised rate.
- A payment amount: show each payment over the loan and how long it applies. For a first lien, say the payment excludes taxes and insurance, if it does, and that the real payment will be higher.
- These (f) disclosures don't apply to "a banner advertisement or pop-up advertisement linked to an application or solicitation provided electronically" (1026.24(f)(4)). The (d) trigger rule still does.
On a website, a clear rate table can meet the (d)(2) disclosures if every other mention of terms "clearly refers to the page or location where the table or schedule begins" (1026.24(e)).
Words banned in home-loan ads
Regulation Z prohibits seven practices in ads for credit secured by a dwelling (1026.24(i)):
| Banned | Unless |
|---|---|
| "Fixed" for a rate or payment that can change | "ARM" or "Adjustable-Rate Mortgage" comes first, and each "fixed" states how long it lasts |
| Comparing a payment to a teaser rate or payment | The ad compares it with the full-term rates and payments |
| "Government loan program" or implying government backing | It is an FHA, VA or similar government-backed loan |
| The consumer's current lender's name | You name yourself with equal prominence and say you aren't that lender |
| Misleading claims the loan will eliminate debt | No exception |
| "Counselor" for a for-profit broker or lender | No exception |
| Some terms only in Spanish (or another language), others only in English | Every trigger term and disclosure appears in the same language |
The CFPB's Regulation N separately bars "any material misrepresentation" about a mortgage's terms in any commercial communication, by any person, including claims that "no fees are charged" and claims that a consumer "has been preapproved" (12 CFR 1014.3).
NMLS number: ads, business cards and websites
Federal law requires the NMLS ID on four loan documents, not on ads:
"(i) The credit application; (ii) The disclosures required by § 1026.19 (e) and (f); (iii) The note or loan contract; and (iv) The security instrument." (12 CFR 1026.36(g)(2))
States add the ad rule. Two examples:
"The unique identifier of any licensed mortgage loan originator shall be clearly shown on all residential mortgage loan application forms, solicitations, or advertisements, including business cards or Internet Web sites." (California Financial Code § 50209)
Texas requires a mortgage company's ads to carry the company's name and NMLS ID, its website address if it has one, and the sponsored originator's name and NMLS ID. A team name must appear with the company's name and NMLS ID "in substantially equivalent prominence" (7 TAC § 56.203(c), (f)). On social media, the regulator lets these details sit on the account profile (Texas SML). For other states, check your state regulator's advertising rule.
Canada: Ontario
Regulation Z doesn't apply in Canada. In Ontario, a mortgage brokerage "shall disclose its authorized name and its licence number in all of its public relations materials and the name and number must be clearly and prominently disclosed" (O. Reg. 188/08, s. 6(1)). "Public relations materials" include any advertisement (s. 1). Agents named in ads must appear under their licensed name with a title such as "mortgage agent" (s. 6(3)–(4)), and ads may not include "false, misleading or deceptive information" (s. 7).
Example
Instagram post: "30-year fixed, 6.25%"
"30-year" is a trigger, and 6.25% is a rate. The post needs the APR, the down payment and the repayment terms (360 monthly payments). In California, add your NMLS ID.
Listing flyer: "Own it for $2,400 a month"
The agent is covered too. The payment is a trigger, so the flyer needs the down payment, the repayment terms and the APR. If the $2,400 excludes taxes and insurance, it must say so and that the real payment will be higher.
Google ad: "Rates from 5.9%"
A rate in an ad must be stated as an APR. "5.9% APR" meets that, plus a note if the rate can rise after closing; "5.9%" alone does not.
Different for you?
- Co-marketing with real estate agents or buying leads: see RESPA Section 8.
- Facebook and Instagram mortgage ads: credit ads run in a special ad category. See Meta special ad categories.
- Advertising financing for something other than a home: see advertising HVAC financing.
- Running compliant rate ads: see the Paid Ads Agent.