CFPB and FTC Warn Mortgage Companies about Potentially Misleading Advertisements


On November 19, the CFPB announced that it issued warning letters to about a dozen nonbank mortgage lenders and brokers regarding advertisements targeted towards older Americans and veterans that may violate the Mortgage Acts and Practices Advertising Rule (MAP Rule). The CFPB claims that certain companies’ ads may (i) make misrepresentations about government affiliation, (ii) provide inaccurate information about interest rates, (iii) make misleading statements about the costs of reverse mortgages, or (iv) misrepresent the amount of cash or credit available to a consumer. The letters do not make any determinations as to whether the ads at issue violate the law, and the letters provide the companies an opportunity to review and remedy any potential violations. However, the CFPB announcement also notes that the Bureau has initiated formal investigations of six companies for “serious violations of the law.” At the same time, the FTC announced that it sent letters to twenty real estate agents, home builders, and lead generators warning that certain advertisements may similarly violate the MAP Rule or section 5 of the FTC Act. The FTC also acknowledged that it has opened nonpublic investigations of other advertisers that may have violated federal law. This coordinated CFPB/FTC action resulted from a review of about 800 randomly selected mortgage-related ads from across the country, including ads for mortgage loans, refinancing, and reverse mortgages. BuckleySandler is representing one of the companies being investigated by the FTC in connection with this review.

Written by:

Published In:


DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© BuckleySandler LLP | Attorney Advertising

Don't miss a thing! Build a custom news brief:

Read fresh new writing on compliance, cybersecurity, Dodd-Frank, whistleblowers, social media, hiring & firing, patent reform, the NLRB, Obamacare, the SEC…

…or whatever matters the most to you. Follow authors, firms, and topics on JD Supra.

Create your news brief now - it's free and easy »

All the intelligence you need, in one easy email:

Great! Your first step to building an email digest of JD Supra authors and topics. Log in with LinkedIn so we can start sending your digest...

Sign up for your custom alerts now, using LinkedIn ›

* With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name.