Key takeaways: 

• Examiners check lending websites for compliance with the Truth in Lending Act (TILA) and fair lending.
• Compliance can’t be a one-and-done check. Outdated rates and missing assumptions can land you in hot water. 
• Knowing what’s required by consumer protection laws makes it manageable to align rate display with disclosure requirements. 
• Strong, exam-ready rate display gets easier with the right tools. 

We’ve talked time and again about the importance of live rate display on your lending website. Showcasing current rates keeps you in competition with the large national lenders, who virtually all do this. And it informs leads before they approach your team. Plus, when live rates feed to a lead workflow, they can serve as a powerful lead generation tool. 

In short, a lending website that advertises rates helps you get more leads in the door and move them more easily toward the closing table. So why don’t all lenders showcase rates? 

For some, fear drives the decision to keep rates hidden. They know that examiners from regulatory authorities can check their rates for compliance with the Truth in Lending Act (TILA) and fair lending practices. And the risk that they could be found out of line feels like it outweighs the benefits that come with live rate display. 

This isn’t a totally unfounded way of thinking. But compliance concerns shouldn’t keep you from using rates to your advantage. You just need to be thorough in aligning your rate display to Regulation Z and fair lending requirements. 

Compliance considerations for lending websites that display rates

If you start reading through Regulation Z yourself, you might feel overwhelmed very quickly. It’s understandable. Like most regulatory guidance, it’s dense. 

But if you break down the rate advertising requirements, they’re actually fairly straightforward. Compliant rate display means showing rates that are:

• Actually available (i.e., aligned with what you can genuinely offer to a borrower based on your currently available products and their pricing)
• Displayed with an annual percentage rate (i.e., you can’t display the interest rate alone)
• Clear about any assumptions that shape the rate (e.g., down payment, credit score)

Consumer protection laws also specify that you can’t display rates that will be misleading. So you can’t just show an estimated monthly payment, for example. You need to accompany that with information to explain what kind of borrower would qualify for that rate and monthly payment. 

Or if you’re displaying an introductory rate for a HELOC, you need to clearly show how long that first period lasts. And you need to spell out what happens to the rate afterward.  

That’s the broad overview. To move toward an examiner-ready rate display, you should do a few things. 

Start with: Clear display of accurate APRs

When examiners look at your site, they’re checking to see if you’re posting misleading or inaccurate information. The best way to be examiner-ready is to do what you can to display the rates you can actually offer in a way that’s easy for borrowers to understand. 

Specifically, §1026.24(a) of Regulation Z says that lenders can only advertise rates they actually have available. To check for that, an examiner might compare the rate on your site with your pricing engine for the same date. 

Fortunately, there’s an easy way to make sure these always match: use a rate display tool that integrates directly with your pricing engine. This way, the displayed data is always an accurate representation of what you can actually offer. 

To get this first piece — your core rate display — right, you need to take one more step. Displaying the interest rate alone isn’t enough. In fact, it’s illegal. Per Regulation Z, lenders are required to accompany any advertised interest rate with the APR. 

You can show the interest rate and APR together or the APR alone. Either way, you need to include the annual percentage rate to give people a more complete idea of their yearly loan costs. And you can’t hide the APR in the fine print. It needs to be displayed at least as prominently as the interest rate. 

Next, add: Spelled-out assumptions

Examiners often check for one key missing element: assumptions. If you’re advertising rate information, you need to include the assumptions shaping that information as well. 

Most rate display tools (and loan officers, for that matter) rely on assumptions to calculate an interest rate. Pricing engines use criteria like the borrower’s credit score and down payment amount to come up with a rate. That means nearly every rate on a lending website is built on assumptions.

For every rate you display, you need to give people access to those assumptions. They can be either on the webpage right by the rate, or a clearly labeled click away. 

Check for: Trigger terms

The trigger term rules for closed-end products (i.e., mortgages, refinances, and home equity loans) are a bit lighter than those for HELOCs, which we'll touch on below. 

Per Regulation Z, closed-end loans need additional disclosure if you pair any of these trigger terms with the rate info. For mortgages, refis, and HELOANs, you fall into trigger-term territory if you mention anything specific about the loan’s:

• Down payment (e.g., “5% down”)
• Repayment period/repayment number (e.g., “30-year fixed-rate mortgage”)
• Payment amount (e.g., “payments as low as…”)
• Finance charge (e.g., “$500 total cost of credit”)

(For closed-end loans, Reg Z allows you to say things like “no down payment” or “no closing costs” without triggering additional disclosures.)

Once you hit a trigger, your rate info then also needs to be paired with:

• The down payment amount or percentage
• The repayment terms (including any balloon payments)
• The APR (and if it can increase after closing, a disclaimer calling that out)
• For ARMs, the rate or payment for each repayment period

And if you triggered Reg Z with a specific payment amount and it didn’t include taxes and insurance, you also need to call that out and say that the actual payment could be higher. 

Regulation Z treats open-end triggers differently. In other words, if you’re displaying rate info for a HELOC, more disclosure rules come into play. 

We covered those in a recent blog. One quick callout here: In the eyes of examiners, for HELOCs, zero is a specific number. Things like “no closing costs” and “no down payment” count as trigger terms for HELOCs.

With home equity lines of credit, you also always need to call out the possibility of any balloon payment, when applicable. And if you mention tax deductibility, advise that they talk to a tax pro. Finally, you can’t refer to the HELOC as “free money.”

The big takeaway: Examiners look for anything that could be misleading or exclusionary

Basically, an examiner wants to make sure you’re not misleading borrowers, intentionally or accidentally. Remember, most people aren’t as familiar with home finance products as you. By calling out pertinent details, you help them understand what this loan would mean for them. 

These rules exist because examiners don’t want borrowers to get confused. Take the Reg Z requirement to pair interest rates with APRs. The APR gives borrowers a more complete idea of total loan costs, so it needs to be clearly displayed to them. 

Finally, examiners also want to make sure you’re offering the same opportunities to all borrowers. They check for things like pricing differences across audiences or exclusions in certain ZIP codes. 

Fortunately, we’ve already thought long and hard about how to show examiners that your displayed rates comply. BankingBridge has a suite of rate display tools you can use that are designed to support Regulation Z-compliant rate advertising. And because these tools connect to your pricing engine, they’re built to show accurate, live, Reg Z-compliant rate info. You can check them out on our test site. 

To explore these rate display solutions for yourself, book a demo with us today.

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