Antitrust Law Daily Wrap Up, CONSUMER PROTECTION NEWS: FTC, CFPB Warn Mortgage Advertisers to Avoid Deceptive Claims, (Nov 19, 2012)
Organizations Mentioned:Consumer Financial Protection Bureau
By Sarah Borchersen-Keto,Washington Correspondent
The FTC and the Consumer Financial Protection Bureau announced on November 19 that they have sent letters to a number of mortgage advertisers regarding potential violations of the Mortgage Acts and Practices-Advertising (MAP) Rule, which targets potentially misleading claims and statements in mortgage advertising, as well as the FTC Act.
The FTC sent its warning letters to real estate agents, home builders, and lead generators, while the CFPB sent its warning letters to mortgage brokers and lenders. The FTC also released a model warning letter to mortgage advertisers.
The agencies have opened nonpublic law enforcement investigations of other advertisers that may have violated federal law.
The CFPB noted that many of the potentially misleading practices seem to be directed at older Americans and service members or veterans. Consumers are being told to be wary of ads that contain an official-looking seal or logo, implying some kind of government status. Promises of very low rates, and assurances that a reverse mortgage will allow you to stay in your home payment-free, are other warning signs to watch out for, as are announcements of pre-approval and offers of large amounts of available cash or credit, the agencies said.
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