A new proposal from the Federal Trade Commission would ban misrepresentations for all mortgages and allow the agency and states to seek civil penalties against those who violate the rule.

According to the FTC, the move is meant to further strengthen its longstanding enforcement program and make the agency more effective in combating deceptive advertising.  The proposed rule would prohibit all material misrepresentations in advertising about consumer mortgage products, including reverse mortgages.

The proposal lists 19 examples of misrepresentations about fees, costs, obligations, and other aspects of credit that would be violations.  The rules would apply to mortgage lenders, brokers, and servicers, real estate agents and brokers, advertising agencies, home builders, lead generators, rate aggregators; and other entities under the FTC’s jurisdiction.

According to the proposal, companies would have to retain copies of all sales scripts, training materials, related marketing materials, websites and weblogs, and various other documents describing mortgage products being sold to consumers, be retained for a period of 24 months to ensure compliance with the rule.