Reiterating and refocusing on ethical reverse mortgage marketing practices, the National Reverse Mortgage Lenders Association issued a new advisory in late September on advertising for reverse mortgage loans.
Under NRMLA’s Code of Ethics, the association points to specific language including “no fee” or “no cost” when used in reverse mortgage advertising as misleading and unethical. The association further stresses and reiterates its commitment to ethical advertising and its prior guidance on advertising including its list of “Dirty Dozen” unethical practices.
Among the list of violations stressed by NRMLA: using terminology that describes “government loan programs,” “government supported” or like terms; stating or suggesting failure to respond to the advertising will result in a loss to the consumer; making exaggerated claims about the benefits of reverse mortgage loans; providing a testimonial or endorsement without making clear the nature of the relationship with the person providing the endorsement; marketing any cross-selling; and others.
Additional violations comprise the “dirty dozen” of marketing to Home Equity Conversion Mortgage (HECM) borrowers.
NRMLA cites the recent Consumer Financial Protection Bureau report on reverse mortgages as having many of the same points.
Written by Elizabeth Ecker