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#2229916 - 01/30/20 03:05 PM Re: Offering a discount for auto-pay P*Q
Ms. X Offline
New Poster
Joined: Jan 2018
Posts: 24
Sorry to revive such an old thread but wondering if there are any additional thoughts on this - trying to determine if the payment example required for a variable rate closed end consumer loan is required in an advertisement (as well as the TIL) if the rate will increase upon an event (such as discontinuing autopay). It's clear to me that it is required in the TIL but unclear if it is required or a best practice in an advertisement. I think Randy is saying that a statement that it may increase is more solid advise than a requirement so I suppose the payment example is not necessary but just want to confirm. Thanks!

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Lending Compliance
#2249479 - 02/19/21 08:07 PM Re: Offering a discount for auto-pay P*Q
scb2011 Offline
Gold Star
Joined: Mar 2011
Posts: 258
TN
I have a question about advertising a program like this, a .15 interest rate reduction if the borrower sets up automatic payment from their checking account. Can we state a rate discount of .15% of the interest rate, with no statement of the interest rate or APR on the advertisement? From reading Reg Z, it appears that we can. We only offer this special on non real estate consumer loans.

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#2249483 - 02/19/21 09:33 PM Re: Offering a discount for auto-pay P*Q
rlcarey Online
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rlcarey
Joined: Jul 2001
Posts: 83,219
Galveston, TX
As long as you do not pull one of the other triggers, then the mention of a discount for autopay on a closed-end loan would not trigger the advertising disclosures.
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