What does TILA require when an interest rate is advertised?

When interest rates are advertised, the Truth in Lending Act (TILA) mandates that the Annual Percentage Rate (APR) is disclosed alongside the interest rate in a manner that ensures clear visibility. This helps consumers to better understand the total cost of borrowing by highlighting the true cost of the loan, which includes interest and fees. By requiring that the APR be presented as prominently as the advertised interest rate, TILA aims to promote transparency and enable consumers to make informed comparisons between different loan offers.

As a result, ensuring that the APR is featured in a font size that is at least equal to that of the interest rate aligns with TILA's objectives of protecting consumers by providing straightforward and comprehensive financial information. This way, borrowers are not misled by attractive interest rates that may not convey the complete picture of the loan’s costs.