The Federal Trade Commission moved to strengthen an enforcement program aimed at stopping deceptive mortgage advertising by proposing a rule to ban all material misrepresentations in advertising about consumer mortgages.

The proposed rule lists 19 examples of misrepresentations about fees, costs, obligations and other aspects of credit that would be violations. The rule would allow the FTC and states to seek civil penalties against violators.

The rule 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. 

Currently, under the FTC Act, the agency may bring actions against those under its jurisdiction who engage in deceptive mortgage advertising - and it may seek injunctive relief against them. Under the proposed rule, the FTC would be able to bring actions against violators to seek civil penalties, along with injunctions. The proposed rule also would allow the states to bring actions for civil penalties for violations.

The FTC is seeking comments about the rule’s costs and benefits, including whether any alternatives would adequately protect consumers at a lower cost. The rule does not include any advertising disclosure requirements, which other federal and state laws impose, but the FTC seeks public input on whether there are advertising disclosures that should be included. 

A 45-day public comment period ends November 15. Comments on the rulemaking proceedings should include the reference “Mortgage Acts and Practices – Advertising Rulemaking, Rule No. R011013.” 

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