|Targeted News Service|
Using the catch phrase "Zip, Zero, Nada,"
The defendants' ads also touted specific monthly payment amounts, such as
The complaint alleges that the operation violated the Federal Trade Commission Act; the Mortgage Acts and Practices Advertising Rule (or "MAP" Rule) and Regulation N; and the Truth in Lending Act and Regulation Z.
Under the settlement,
* misrepresenting the terms of any mortgage credit product including the interest charged, the annual percentage rate, the existence or amount of fees or costs to the consumer, the consumer's monthly payment, and taxes and insurance, among other things.
* misrepresenting or assisting others to misrepresent any relevant facts concerning the sale of homes and related products and services, such as the total costs; any material restrictions, limitations, or conditions, including that the consumers will pay
* representing a periodic payment amount, and failing to adequately disclose when applicable:
o that the loan requires qualifying and financing through the USDA Rural Development Loan Program or another financing program that imposes credit and income limits.
<p>o that the loan requires a good faith deposit and a guaranty fee, and
o the amount or percentage of those fees, among other things, in violation of Regulation N, the Truth in Lending Act, and Regulation Z. * failing to keep a record of advertising to demonstrate that they are complying with the order.
The FTC established the MAP Rule, which later became Regulation N, to strengthen consumer protections by banning deceptive claims about mortgages. The rule allows the FTC to seek civil penalties for violations. The settlement with defendants imposes a
For consumer information about mortgages, see Homes and Mortgages.
In addition to
The Commission vote to authorize the staff to refer the complaint to the
The DOJ filed the complaint and proposed consent decree on behalf of the Commission in
NOTE: The Commission authorizes the filing of a complaint when it has "reason to believe" that the law has been or is being violated, and it appears to the Commission that a proceeding is in the public interest. Consent decrees have the force of law when signed by the District Court judge.
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