What is required of creditors regarding advertising rates under Regulation Z?

The correct choice highlights the requirement that if creditors choose to mention specific rates in their advertising, they are obligated under Regulation Z to disclose additional terms and conditions associated with those rates. This requirement is part of the broader purpose of the Truth in Lending Act, which aims to promote informed use of consumer credit by requiring clear and truthful disclosures in advertising.

By requiring creditors to disclose additional terms and conditions when specific rates are advertised, Regulation Z ensures that consumers are not misled and have the necessary information to make informed financial decisions. This includes important details such as the annual percentage rate (APR), repayment terms, and any other relevant charges that may apply, thus providing a more comprehensive understanding of the financial product being offered.

This approach discourages misleading advertising practices and protects consumers from potentially unfavorable loan terms that they may not be aware of if only the rate is advertised without associated conditions.