(a) It is unlawful for a seller to advertise any payment, number of payments, or period of repayment for any goods, property, or services purchased through an extension of consumer credit under an open-end credit plan accepted for purchases by more than one seller unless the seller clearly and conspicuously discloses all of the following:

(1) The cash price and the amount or percentage of a downpayment, if any.

Terms Used In California Business and Professions Code 17538.7

  • Annual percentage rate: The cost of credit at a yearly rate. It is calculated in a standard way, taking the average compound interest rate over the term of the loan so borrowers can compare loans. Lenders are required by law to disclose a card account's APR. Source: FDIC
  • board: means any entity listed in Section 101, the entities referred to in Sections 1000 and 3600, the State Bar, the Department of Real Estate, and any other state agency that issues a license, certificate, or registration authorizing a person to engage in a business or profession. See California Business and Professions Code 31
  • Federal Reserve System: The central bank of the United States. The Fed, as it is commonly called, regulates the U.S. monetary and financial system. The Federal Reserve System is composed of a central governmental agency in Washington, D.C. (the Board of Governors) and twelve regional Federal Reserve Banks in major cities throughout the United States. Source: OCC
  • Finance charge: The total cost of credit a customer must pay on a consumer loan, including interest. The Truth in Lending Act requires disclosure of the finance charge. Source: OCC
  • Open-end credit: A credit agreement (typically a credit card) that allows a customer to borrow against a preapproved credit line when purchasing goods and services. The borrower is only billed for the amount that is actually borrowed plus any interest due. (Also called a charge account or revolving credit.) Source: OCC
  • Subdivision: means a subdivision of the section in which that term occurs, unless some other section is expressly mentioned. See California Business and Professions Code 15
  • Truth in Lending Act: The Truth in Lending Act is a federal law that requires lenders to provide standardized information so that borrowers can compare loan terms. In general, lenders must provide information on Source: OCC

(2) The monthly or other periodic payment, the number of payments or the period of repayment, the total amount of all payments, and whether the monthly or other periodic payment is calculated on the assumption that the purchaser has no outstanding balance due under the open-end credit plan, if that is the case.

(3) The amount of the finance charge and any periodic rate that may be applied expressed as an annual percentage rate as described under subdivision (e). If the open-end credit plan provides for a variable periodic rate, that fact shall be disclosed.

(4) Any minimum, fixed, transaction, activity, or similar charge and any membership or participation fee that could be imposed.

(5) The name of the creditor, if not the seller.

(6) Whether the advertised terms are available to the purchaser only after the creditor’s approval, if that is the case.

(b) (1) A catalog or other multiple-page advertisement that gives information in a table or schedule in sufficient detail to permit determination of the disclosures required by subdivision (a) shall be considered a single advertisement if (A) the table or schedule is clearly and conspicuously set forth, and (B) any statement of the amount of any payment, the number of payments, or the period of repayment appearing anywhere else in the catalog or advertisement clearly refers to the page on which the table or schedule begins.

(2) A catalog or multiple-page advertisement complies with subdivision (a) if the table or schedule includes all appropriate disclosures for a representative scale of amounts up to the level of the more commonly sold higher-priced property or services offered.

(c) It is unlawful for a seller to advertise any payment, number of payments, or period of repayment for particular goods, property, or services purchased through an extension of consumer credit under any open-end credit plan unless the seller clearly and conspicuously discloses the cash price proximate to the advertised payment, number of payments, or period of repayment.

(d) It is unlawful for a seller to advertise terms that actually are not or will not be arranged or offered by the creditor.

(e) (1) For the purposes of this title, the terms “person,” “creditor,” “consumer credit,” “open-end credit,” “cash price,” “downpayment,” “finance charge,” “periodic rate,” and “annual percentage rate” have the same meaning as used in Regulation Z.

(2) The term “Regulation Z” shall mean any rule, regulation, or interpretation promulgated by the Board of Governors of the Federal Reserve System under the Federal Truth in Lending Act, (Public Law 90-321, as amended), and any interpretation or approval issued by an official or employee of the Federal Reserve System duly authorized by the board under the Truth in Lending Act, to issue those interpretations or approvals.

(Added by Stats. 1985, Ch. 734, Sec. 1.)

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