NRMLA Publishes Additional Ethical Advertising Requirements

A new ethics advisory opinion published by the National Reverse Mortgage Lenders Association addresses inappropriate advertising practices seen over the past few months.

The opinion addresses six specific advertising acts and that not only violate the NRMLA Code of Ethics, but may violate applicable federal and state law requirements.  One of the practices seen by the association relates to reverse mortgage lenders advertising some HECM products as no cost loans.

“While lenders may be waiving origination fees, paying borrowers closing costs and even paying for some or all of the up‐front FHA mortgage insurance premium due to the FHA (which sums may more usually be paid by the borrower), reverse mortgage loans, nevertheless, are not cost free,” said the association.  “Such claims of “no cost” also may violate several provisions of federal and state law, and federal regulatory guidance with respect to reverse mortgage marketing in that such claims can be and often are misleading if not downright false.”


The advisory opinion goes on to address other topics including the use of celebrities, pre-approved loans, “stimulus money”, simulated checks, and the use of HUD logo when advertising reverse mortgages.

All NRMLA members are required to comply with the Code of Ethics as a condition of membership.  If the Committee determines that a NRMLA Member has not complied with the Code of Ethics, sanctions may be imposed, up to and including the termination of NRMLA Membership.

To view a copy of the advisory, see here.

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  • Quite a few of my clients send me the mail they get from time to time and I can only tell you that I don’t believe NRMLA governs this very well- the same guys are doing it all day long.

  • As long as interest is being accrued, how could there be a “no cost” reverse mortgage? As more fees are “buried” into interest rates, I do not see how reverse mortgages can be marketed as “no fee.”

    I have problems with the celebrity rule. Even Medicare does not disclose that Andy Griffith is providing a commercial for the Democrats running for Congress — oops that’s a different topic….

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