What is required by law from lenders when "trigger terms" are used in advertising?

When "trigger terms" are used in advertising, the law requires lenders to provide additional disclosures about credit terms. Trigger terms are specific phrases or statements that can induce a consumer to seek more information about a loan. When these terms are included in advertising, regulations such as the Truth in Lending Act (TILA) mandate that lenders must disclose critical information regarding the loan's terms, including the annual percentage rate (APR), payment terms, and any fees that are associated with the loan.

This requirement is in place to ensure that consumers receive comprehensive information about the loan they might consider, promoting informed decision-making. By mandating additional disclosures, the law aims to protect consumers from deceptive or misleading advertising practices that could arise from the use of enticing trigger terms without a full understanding of the financial implications involved. This focus on transparency is a key element of consumer protection in the mortgage lending industry.