In advertisements, which type of credit is affected by the disclosure of the APR as a trigger term?

The concept of "trigger terms" in the context of consumer credit advertisements is important in determining how different types of credit are regulated under laws such as the Truth in Lending Act (TILA). When an advertisement includes the Annual Percentage Rate (APR) as a specific term, it triggers additional disclosure requirements.

For open-end credit, which includes types of credit like credit cards or lines of credit, the mention of APR prompts lenders to provide important additional information regarding the terms and conditions of the credit. This is designed to protect consumers by ensuring they receive comprehensive information to make informed decisions.

In contrast, closed-end credit, such as personal loans or auto loans, doesn't have the same regulations surrounding the disclosure of trigger terms when it comes to advertising APR. Thus, if an advertisement mentions the APR in relation to closed-end credit, the implications might differ compared to open-end credit scenarios.

Therefore, the statement that only open-end credit is impacted by the disclosure of APR as a trigger term is accurate because it reflects how consumer protections are structured to ensure clarity in advertisements for revolving credit products. In this regulatory framework, the focus is on how disclosures facilitate informed consumer choices, particularly in the context of ongoing credit access associated with open-end credit arrangements.