Last week, the CFPB announced an enforcement action against RMK
Financial Corporation d/b/a Majestic Home Loans (RMK) related to
deceptive mortgage advertising practices. This enforcement action
is the most recent in a series of enforcement actions and
administrative proceedings concerning the 2011 Mortgage Acts and
Practices Rule (Regulation N), 12 C.F.R. § 1014, governing
misrepresentations in mortgage advertising.
Regulation N, effective as of December 30,
2011, generally forbids "any person to make any material
misrepresentation, expressly or by implication, in any commercial
communication, regarding any term of any mortgage credit
product." The non-exhaustive list of potential terms that must
be clearly identified include: (i) government affiliation (or lack
thereof), (ii) interest rates, (iii) fees to be charged, (iv)
payments associated with the loan, and (v) the amount of credit
available to consumers.
