#4 - THE BEST
The fourth most commonly remediated term for personal loans is “the best.”
Using phrases like “the best” implies that the product being marketed is superior to all other products in the market.
However, there is no objective way to determine what is "the best,” as what is considered the best for one person may not be the best for another and is based on an individual’s unique needs and situations.
#3 - OUTDATED APR
The third most remediated category for personal loans is outdated APRs.
Under the Truth in Lending Act (TILA), lenders are required to disclose the APR accurately and uniformly in all of their marketing materials, including advertisements, application forms, and credit agreements.
Since APRs are a key factor for consumers to determine the cost of credit and help them compare loan products, an inaccurate APR rate can be deceptive and harm consumers.
#2 - CREDIT DECEPTION
The second most commonly remediated category for personal loans is credit deception, which in this case, flags a list of terms in proximity to the word "credit" that could be potentially misleading.
Terms here include “credit rating,” “help your credit,” “bad credit,” and “repair credit.” While some products may actually help repair and improve credit, that may not be the case for every consumer, which could lead to potential UDAAP issues.
#1 - PAYDAY
The top most remediated compliance term for personal loans is “payday.”
In this context, we’ve seen instances where external entities use brand names to falsely promote certain products or services as “payday” loans, quick cash, instant money, etc. and encourage consumers to apply for a loan. The consumer thinks they’re applying for a product from a certain company, but instead, they’re giving their information to a fraudulent third party that has no relation to the brand that they are promoting.
In this example, the call-to-action “request a payday loan” does not bring the consumer to the company’s website.
A company is responsible for monitoring all places in which its brand is being promoted (both known and unknown), whether or not third parties are involved.