Dealers are reminded that there are several important federal regulations that govern the advertising of leases and credit. Dealers, their advertising agencies and others responsible for the content of dealer advertisements must be familiar with these regulations. However, dealers are ultimately responsible for ensuring that all of their advertisements comply with the applicable rules.
If you advertise consumer leases, then your ads must comply with the rules for lease advertising found in the Consumer Leasing Act and Regulation M (“Reg M”). Among its other requirements, Reg M requires certain disclosures for lease advertisements and requires that if an advertisement includes certain “trigger terms” (such as the lease payment amount), the advertisement must also include certain required disclosures (such as the total amount due prior to or at consummation and a statement that an extra charge may be imposed at the end of the lease term). For more information on lease advertising requirements, see the FTC publication, “Advertising Consumer Leases.” Click here for more information from NADA regulatory affairs.
If you advertise consumer credit, then your ads must comply with the rules for credit advertising under the Truth in Lending Act (“TILA”) and Regulation Z (“Reg Z”). Reg Z contains similar requirements for credit advertisements and requires that if an advertisement contains certain “trigger terms” (such as the payment amount), the advertisement must also contain certain required disclosures such as the APR, the amount or percentage of any down payment and the terms. Click here for more information on credit advertising requirements under Reg Z. Click here for more information from NADA regulatory affairs.
All required disclosures under Regs M and Z – not only the trigger terms, but also the required follow-on disclosures – must be made “clearly and conspicuously” to be compliant.
Also, dealers must also comply with these requirements in online advertising. For details about online advertising, see the NADA Management Guide. “Electronic Disclosure Rules for Dealership Online Commerce,” available at http://www.nadauniversity.com/.