A billboard advertisement for a HELOC promotes “Prime + 0%”. There are no disclosures. A marketing person claims that “Prime + 0%” cannot be readily determined, is not a statement of the rate, and therefore is not a triggering term for the Reg. Z advertising rules. Based on the definition of advertising in the rule, I believe this ad is not exempt. Also, based on the following Commentary references I believe that "Prime + 0%" is a triggering term.
Am I out of line with this?
[i]Paragraph 16(b) Advertisement of terms that require additional disclosures.
3. IMPLICIT TERMS. Section 226.16(b) applies even if the triggering term is not stated explicitly, but may be readily determined from the advertisement.
7. TRIGGERING TERMS. The following are examples of terms that trigger additional disclosures:
• "Small monthly service charge on the remaining balance, which describes how the amount of a finance charge will be determined."
Paragraph 16(d) Additional requirements for home equity plans.
1. TRIGGER TERMS. Negative as well as affirmative references trigger the requirement for additional information. For example, if a creditor states "no annual fee," "no points," or "we waive closing costs" in an advertisement, additional information must be provided. (See comment 16(d)-4 regarding the use of a phrase such as "no closing costs.") Inclusion of a statement such as "low fees," however, would not trigger the need to state additional information.[i/]