After reviewing hundreds of mortgage advertisements, the Federal Trade Commission has sent letters to 20 companies, warning them that their ads may be deceptive.
The FTC letters went to real estate agents, home builders, and lead generators, urging them to review their advertisements for compliance with the federal laws meant to protect consumers from deceptive or misleading claims about the terms of mortgages, including interest rates.
The FTC sent the letters in coordination with the Consumer Financial Protection Bureau (CFPB), which issued warnings to approximately a dozen other companies. The CFPB sent its warning letters to mortgage brokers and lenders.
The agencies reviewed approximately 800 mortgage ads from a variety of media that included web sites, Facebook, direct mail, and newspapers.
The agencies’ review found, for example:
- Advertisements offering a very low “fixed” mortgage rate, without discussing significant loan terms.
- Advertisements containing statements, images, symbols, and abbreviations suggesting that an advertiser is affiliated with a government agency.
- Advertisements “guaranteeing” approval and offering very low monthly payments, without discussing significant conditions on these offers.
The FTC has advice for consumers about mortgage advertising. For more information see the website Your Home and the publication Deceptive Mortgage Ads: What They Say; What They Leave Out.