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Clear and Conspicuous Disclosures on Banner Ads

Friday, June 07, 2024 9:00 AM | Anonymous member (Administrator)

[From the BBB] The BBB is increasingly seeing banner advertisements on dealer websites containing finance offers with either no Truth in Lending (TILA) disclosures, as required by Rule 475.610, or disclosures that are so small on the computer screen as to be unreadable and, therefore, unavailable to consumers. In contrast, most lease offers on banner ads do have the disclosures required by rule 475.710. There are exceptions to that, however.

Truth in Lending disclosures are not only required in Illinois but in every state under Regulation Z of the Truth in Lending Act and must be set out in a clear and conspicuous manner. To the extent these banner ads are provided by third parties assisting dealers around the country, as well as in Illinois, there is this federal law to consider. It is surprising that TILA disclosures are so widely disregarded for this reason.  We often see third party advertisers being unfamiliar with Illinois rules but not federal law.

Rule 475.610 provides as follows:

Section 475.610  Credit Sales Advertising Disclosures

 It is an unfair or deceptive act to advertise "closed-end credit" terms in the advertisement, offer of sale, or sale of any motor vehicle if the advertisement contains any one of following five "triggering terms": amount or percentage of down payment; number of payments; period of repayment; amount of any payment (expressed as percentage or dollar amount); or amount of any finance charge, without clearly and conspicuously disclosing:

  • amount or percentage of any down payment, terms of repayment, and "annual percentage rate" using that term spelled out in full or the abbreviation "APR".  If the annual percentage rate may be increased after the contract is signed, that fact must be disclosed. An advertisement that complies with the Federal Truth in Lending Act (15 USC 1601 et seq.) and amendments thereto, and any regulations issued or that may be issued under that federal statute, shall be deemed in compliance with the provisions of this subsection.
  • the contractual amount owing at the conclusion of a pre-determined schedule of installment payments, in close proximity to and, where applicable, in the same decibel tone as, the "triggering term" when a dealer advertises the availability of balloon-note financing.  For the purpose of this subsection (b), balloon-note financing shall mean the manner of purchase whereby a consumer agrees to select and perform, at the conclusion of a pre-determined schedule of installment payments made in periodic or monthly amounts, one of the following options:
    • satisfy the balance of the contractual amount owing;
    • refinance any balance owing, on the terms previously agreed upon at the time of executing the retail installment contract; or
    • surrender the vehicle at such time and manner agreed upon at the time of executing the retail installment contract.
  • a manufacturer’s or manufacturer captive finance company's tiered financing offer.  For the purpose of this subsection (c), tiered financing shall mean the manner of financing a purchase whereby a consumer must qualify for a specific manufacturer's or manufacturer captive finance company's offer according to pre-established credit qualifications.
    • Proper disclosures might include:
      • Ad copy: 1.9% APR for 48 months
      • Disclosure: Financing subject to credit approval and insurability. 1.9% financing for 48 months on (vehicle make/model) in lieu of rebate to qualified buyers and ends (date). 48 months at ($ amount) per month per $1000 financed at 1.9% APR (level a, b, c) with 10% down on (vehicle make/model). Finance rate varies depending on credit worthiness of customer as determined by (captive finance company).  Some customers will not qualify.

(Source:  Amended at 25 Ill. Reg. 4819, effective March 20, 2001)

Dealers can violate this rule by offering finance triggering terms, such as payment amounts or number of months, and failing to provide the disclosures required by part (a) of the rule on website banners as well as pop-ups or failing to provide them clearly and conspicuously.

Clear and conspicuous is a widely used legal standard.  It is defined as follows in section 475.110. 

"Clear and conspicuous " (including the terms "clearly" and "conspicuously") means that the statement, representation or term being conveyed is in close proximity to the statement, representation or term it clarifies, modifies, or explains, or to which it otherwise relates; readily noticeable; reasonably understandable by the person(s) to whom it is directed; and not contradictory to any terms it purports to clarify, modify or explain.

A statement, representation or term is not clear and conspicuous unless it shall:

For printed, written, typed or graphic advertisements:

  • employ abbreviations only if they are commonly understood by the public (e.g., abbreviations commonly understood – AC, AM/FM, AUTO, AIR, 2DR, CYL, MSRP, and e.g., abbreviations not commonly understood – WAC, PEG) or approved by federal or State law (e.g., terms allowed by the Federal Truth in Lending Act, 15 USC 1601, et seq., or the Consumer Leasing Act of 1976, 15 USC 1601, et seq., such as "APR");
  • be of sufficient prominence in terms of print, size and color contrast, as compared with the remainder of the advertisement, so as to be readily noticeable to the person(s) to whom it is directed.  Any type size which is 10-point type or larger is deemed readily noticeable.

Dealers can take note that, in the context of banner ads, clear and conspicuous means “be of sufficient prominence in terms of print, size and color contrast, compared to the rest of the advertisement so as to be readily noticeable to the persons to whom it (the banner ad) is directed.

Type size 10 point or larger is deemed to be readily noticeable.

The BBB has written many letters to dealers on this issue.   We hope this article alerts dealers to monitor their banner ads for finance offers and make sure the mandatory disclosures are included in a type size that is readable.

The BBB also continues to monitor the dealer marketplace in an effort to ensure that a level playing field exists for all dealers.  We encourage dealers to continue to advise the BBB of issues they see as well. 

Chicago Automobile Trade Association
18W200 Butterfield Rd.
Oakbrook Terrace, IL 60181 
(630) 495-2282


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