Answer by Richard Insley:
There is an epidemic of illegal mortgage rate advertising online. Reg Z clearly requires an advertiser to include a representative example of the terms of repayment when a trigger term is mentioned. The Commentary to Section 226.24 is crystal clear on this point. Just because it is common industry practice to ignore this rule does not excuse violations. As regulators finally get around to testing bank websites for compliance, they usually cite these problems as Reg Z violations.
Answer by Andy Zavoina:
I agree with Richard. Paying attention to detail is becoming a lost art in many Web site disclosures. When one does it others think it must be OK. In fact, it just hasn't been caught yet.
To avoid all the required disclosures you have to stay away from the triggering terms. You should either do it right, or just advertise a number to call for rates and disclosures. The good there is that you don't hurt yourself if your rates are higher than other lenders the person is shopping. The bad is that you have to get them interested enough to call.
First published on BankersOnline.com 4/1/02