When is advance notice required for changes in terms?

Advance notice is required for changes in terms primarily when those changes may reduce the Annual Percentage Yield (APY) or otherwise adversely affect the consumer. This requirement is designed to ensure that consumers have sufficient information to understand how changes to account terms may impact their financial situation. For example, if a bank plans to lower the interest rate on savings accounts, it is crucial for customers to be informed ahead of time, as this can significantly affect their earnings.

The underlying intent of this requirement is to maintain transparency and allow consumers to make informed decisions about their accounts. By giving advance notice, customers can choose whether to stay with their current account or look for alternatives that may offer better terms.