On September 1, 2020, the Consumer Financial Protection Bureau (“CFPB”) announced that it had issued a consent order against a Maryland-based corporation offering VA-guaranteed loans in twelve states. According to the consent order, the CFPB found the company had sent consumers millions of advertisements containing deceptive or misleading statements and inadequate disclosures, in violation of § 1026.24 of Regulation Z, 12 C.F.R. § 1026.24, the implementing regulation of the Truth in Lending Act (TILA), 15 U.S.C. §§ 1601–1667f; § 1014.3 of the Mortgage Acts and Practices—Advertising Rule (MAP Rule or Regulation N), 12 C.F.R. § 1014.3; and §§ 1031 and 1036 of the Consumer Financial Protection Act of 2010 (CFPA), 12 U.S.C. §§ 5531, 5536. For example, the consent order states that the company included specific credit terms and interest rates in its advertisements when it did not actually offer mortgages with those specific terms. According to the CFPB, in other advertisements, the company offered specific payment amounts for an advertised loan, without disclosing that that payment amount was not available for the full term of the loan. The company also allegedly represented that it was affiliated with the government, including the VA, when it was not.
Under the consent order, the company must pay a $230,000 civil money penalty. According to the CFPB, the consent order stems from “a Bureau sweep of investigations of multiple mortgage companies that use deceptive mailers to advertise VA-guaranteed mortgages, ” which has already resulted in six settlements since July.