CFPB, FTC Warn of Ads Targeting Seniors
The Consumer Financial Protection Bureau’s Office of Enforcement and the Federal Trade Commission said Monday that letters have been sent to a number of lenders about possible violations of a mortgage advertising rule, and both agencies are urging consumers to exercise caution when seeing suspicious ads.
The Mortgage Acts and Practices – Advertising Rule, which went into effect August 2011, addresses claims and statements in mortgage advertising that may be misleading to consumers, particularly older Americans, servicemembers and veterans.
The agencies are asking the public to be on the lookout for ads that promise:
- loan offers with official-looking seals or logos that imply some kind of government status – the CFPB and FTC are reminding consumers that government agencies are not involved in the actual lending or advertising of loans;
- amazingly low rates – the agencies urge consumers to read the fine print;
- a reverse mortgage will allow consumers to stay in their homes payment-free – typically borrowers with reverse mortgages still have to keep up with tax and insurance payments – and will most likely lose their homes if they don’t;
- they have been “pre-approved” to receive large amounts of cash or credit.