Craigslist Mortgage Ad's Beware
As a Licensed Florida Mortgage Broker located in the South Florida (Palm Beach County) I really cannot believe some of the ad's that are Craigslist for Mortgage's. Just to let you know I do advertise on Craigslist as well but recently I cannot believe what some of my competition is posting.
KNOW THE LAW
Florida makes it very simple when you advertise for Home Loans. If you choose to advertise the following: (Please note this is FLORIDA Law.)
You must clearly display all terms of the loan if not it is illegal and can be reported to the Office of Financial Regulations. If the company advertise a rate for example lets use 5.75% WOW sounds great doesn't? The rest must be clearly displayed as well. The term of the Loan (is it a 5 year arm, 15 year fix, 30 year fix, etc..) In addition the APR Must also be posted as-well. They cannot use the term "NO FEE's" the APR Must be displayed. Why you may ask? Very simple lets take a look at the same ad Below:
5.75% (Sounds Good and Catches Your Eye)
30 Year Fix (OK even better)
7.25% APR.... OUCH!! Still think it is a good deal?
Now the one that drives me crazy. 2.75% Interest rate fixed for 5 years. This is totally a illegal ad because their is no interest rate in today's market at 2.75% PERIOD! What this program is a Hybrid Option Arm. Yes it is a Neg-AM Product. The sad part is I believe this is a great program when used and explained properly but not through misleading advertising. The 2.75% is the payment rate not the interest rate but the true interest rate of this loan is locked for 5 years. Also did you notice their is not APR Clearly posted?
In closing, if you are find any ad on Craigslist or anywhere else in Florida please make sure if the Interest rate is posted then the term and also the APR must be as well. If they are not clearly advertised what does it say about the Mortgage Company?
For More Mortgage Advice: Mortgage Advice In South Florida
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Full-Time Mortgage Broker in South FL. Palm Beach County. Specializing in Hard Money / Private Money, Foreign Nationals, Jumbo and Super Jumbo Loans. In addition I work with Today's Premiere Lenders.
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Thanks for pointing this out.
Matthew.- It's really scary some of the stuff I see out there!....
Patricia, My pleasure I just advertise on their as well and it makes everyone look so bad when people do that
Rich, You said it!
Matt, We need to change your logo to myfavoritehonestmortgage.net. Thanks for looking out for everyone!
Lysa, Thank you Thank you Thank you..:-) <blush>
In NV, You cannot advertise ANYTHING unless it is approved by the Mortgage Lending Diviosion (MLD) (www.mld.nv.gov) first! To do so is a $10,000 fine (no less) for EACH AD!
Matthew... I guess if you aren't a good LO, you can always lure them in with the good 'ole great rate trick! Sad part is, some people still wish and believe its true and possible, without ever really knowing all the details of the loan!
This is one of those issues that makes me crazy. I'm still seeing ads on Yahoo and Goole saying "Interest Rates Have Dropped - the Fed lowered the rates? It's pure BS and people bite. Those of us that are legit now have to waste time explaining these programs to unsuspecting clients. There needs to be some strong national regulation on advertising disclosures.
Kris, I was aware of that but I have to say it makes sense. In Florida by law if you do advertise you must keep records of everything you do. THanks for the heads up
Kim, So true So true..Thank you
Kate, Rates have gone down that part is true but what drives me crazy is when they say the FED Lowered the rate. This is total you know.. Prime has nothing do with mortgages. Prime is tied to Credit Cards and HELOC's. Thank you
Amazing what people will advertise ... then have poor unexpecting clients walking through the door, not understanding the product they are getting. Wild really.
Matt,
I have seen those ads.. Not exactly Legal!! I really wrote an Iffy Post Earlier, Didn't I?
Tom Weiss
It's not just mortgage...my aunt went looking for furniture and clicked on a link to look at a sofa....and the virus infected her machine BAD. No monitoring there so hard to tell what's good. I saw Realtors® advertising listings and it wasn't even theirs.
Some people are actually smart enough to spot the compliant ads and recognize that it comes from a professional.
I have a love/hate relationship w/ craigs list. Thanks for the warning
Bryon, Very true. But hopefully the people will read everything..we can always hope
Tom, Yes but not in a bad way.. you never quoted rate or anything like that
Sally,WOW. I can't believe that one. I never thought of the virus stuff thank you for letting me know
Tom, I hope so it just gives everyone such a bad name when they allow that cr-p to go on.
Dana, My pleasure.. Craigslist is good but I just believe we all should know the laws.
wow, 2.75% interest rate fixed for 5 years, where do i sign up, i'll take 2.
truth in advertising, to some of us it's a daily way of doing business, for others they don't know the meaning.
Jay, I know right..lol
thanks for the heads up - I guess it is the usual 'if it sounds too good to be true, it probably is'-
Matt,
Some of the stuff I see on Craigslist is a little scary, some of the real estate ads as well. This is a good reminder! :)
ah - very good advice - when a buyer asks about these kinds of lenders and stuff - I ask them would you let ebay have this kind of financial information about you? they generally will then call a local lender then
Bill & Barbara, So true.. Great words of wisdom
Suzanne, My pleasure . You are right some stuff is wild
Thesa, wow. Great advice I never heard that one before great analogy.
Matt,
As you know I do not know anything about advertising guidelines for your industry:) What do I know:)
But I use them quite a bit for listings and also utilize the HTML for Vflyers and postlets...you have to be careful though on what you put there or they are strict and will surely follow the standards of advertising. Thanks for letting us know.
Neal, My pleasure. Nothing wrong with advertising on Craigslist. I do myself. I just think when people advertise like that it really gives the lending industry a black eye.
Craig's list is a great place to find Scammers. Thanks for the heads up.
Also, thanks for commenting on Mortgage Fraud #1: Series Introduction and Foreclosure Rescue Scam
Excellent point!
I see those "mortgage rates have dropped" ads all the time online as well. It's frustrating for us agents because it confuses our clients and they end up passing up good deals because they're still trying to find the loan broker with that mythological perfect loan.
Craigslist can be a great spot to advertise on. It would be a better one if everyone using it was honest. Another problem I've seen is unscrupulous people "flagging" perfectly good ads in order to reduce competition for their ad to be seen.
Dan, My pleasure you wrote a great post I would recomend everyone to read it
Cindy, Very true. I know I was the victim of one my ads just because my ads said "Tired of Playing the Mortgage Game" I never advertise rates...it just overpromises people and sets their level way to high. Thank you for your comment
everytime I see Craigslist I get concerned. It seems there is a lot of spam generated from there.
Peg, I agree. I enjoy craigslist and think you can get some amazing things on their. However people should really know what they are doing.
Just like car ads... if you're advertising a lease, you have to tell how much down you're going to have to pay
Knowing the Rate and APR is one way to start the comparison with everyone else out there...
once people realize that if it sounds too good to be true it is, they'll start using Honest Mortgage Brokers instead of the dishonest Loan Officers and Bankers
David, I hope so but like PT Barnum said Their is one born every minute
It's like the broker who called me a few months back who lived in a $2.2M house in Wellington and was buying a new construction condo in downtown West Palm Beach as an investment property. He insisted that I put it through as a 2nd home. When I told him it wouldn't fly because the condo was only 15 miles away. He starts arguing with me. I asked him if he thinks he can get it through DU then why isn't he. He says and this is a classic, "Because I can't. They won't accept a 2nd home less than 75 miles away." I immediately hung up on the guy.
It's crazy out there right now! It's not just in Florida, it's everywhere.
Steve, Don't you just love that one...I love it when other brokers keep calling you and pretend they are the client just to see how you would structure the deal.. I was born at night not last night..lol Thanks for the comment