When it comes to mortgage advertising, you know the rules you must follow. But did you know that social media publishers also have policies to ensure compliance? While these policies may seem restrictive, they help maintain compliance with mortgage regulations. In this article, we’ll delve into the most important rules for mortgage advertising and how social media platforms enforce them. Keep reading to learn more.
Effective Mortgage Advertising: A Multichannel Approach
To succeed in the mortgage brokerage business, trust is everything. Clients must believe you have their best interests and are working to secure the best possible loan terms. Therefore, the most successful marketing tactics will build trust, establish you as an authority, and foster strong client relationships.
Online mortgage marketing is becoming increasingly popular due to its convenience, affordability, and effectiveness. Using the right lead-generation tactics, you can attract potential clients to your website through organic search results or PPC ads.
But pay attention to traditional marketing methods, such as handwritten direct mail. These tangible marketing materials place something physical in the hands of your potential clients, allowing them to interact with and remember your brand.
In a trust-based industry, the emotional impact is as crucial as the features and benefits you promote. Clients want to work with brokers who make them feel comfortable and secure. That’s why a multichannel approach combining traditional and digital marketing initiatives is the best strategy for reaching and retaining clients.
If you want your message to be heard and your brand to stand out, consider adopting a multichannel approach that reaches clients wherever they frequent.
Using Interest Rates in Mortgage Advertising: Guidelines to Follow
Advertising mortgage interest rates are allowed, but knowing the rules and regulations governing mortgage advertising is essential. For starters, the interest rate you list must be the actual rate your company offers. This means that for social media advertising, you must be ready to update or remove an ad immediately if rates suddenly increase and you can no longer honor the listed rate.
Another requirement is to display the annual percentage rate (APR) alongside the interest rate. The APR should be the same size as the interest rate and just as visible.
Additionally, any mandatory disclosures must be conspicuous and presented. Federal mortgage rules state that required disclosures shouldn’t be hidden or obscured by “graphical displays, shading, coloration, or other devices.”
Follow these guidelines and responsibly use interest rates in your mortgage advertising to avoid regulatory issues.
Federal and state guidelines for mortgage advertising:
To comply with regulations, lenders must adhere to federal advertising rules for consumer mortgages and state regulations for both consumer and business mortgages. It’s important to consult both sets of guidelines to ensure compliance. This article explores the federal rules governed by the Federal Trade Commission (FTC) and the Consumer Financial Protection Bureau (CFPB).
- First-point-of-contact information rules:
First-point-of-contact marketing materials, such as business cards, emails, websites, and social media profiles, must include the broker’s name and licensing number to establish a relationship with prospective clients.
- Availability of advertised mortgages:
If specific mortgage terms are advertised, they must be available to borrowers. Misrepresenting the consumer’s likelihood of mortgage approval violates Regulation N.
- Misleading terms:
Mortgage advertising, including on social media platforms, must not include false or misleading terms about interest rates, fees, costs, taxes, insurance, and other aspects of an advertised mortgage.
- Triggering terms:
The FTC defines certain words or phrases that advertise specific credit agreement terms as triggering terms requiring disclosures. Examples include finance charges, number of payments, and down payment amounts in percentage or whole dollar amounts.
- Other prohibitions:
Mortgage advertising is prohibited from including simulations of checks and discriminating based on ancestry, color, disability, marital status, natural origin, race, religion, or sex.
- Mortgage advertising on Facebook:
Facebook offers tools to help advertisers remain compliant, requiring the use of Special Ad Audiences for certain advertisers to choose a broad target audience that is inclusive and non-discriminatory.
- Rules about interest rates:
Current interest rates can be used in mortgage advertising but must be the actual rate currently offered by the company. The annual percentage rate (APR) must be displayed conspicuously.
Ensuring Mortgage Compliance: Understanding Regulations B, N, and Z.
Mortgage lenders must adhere to specific regulations when advertising to remain compliant. Three principal regulations are to consider: B, N, and Z.
- Regulation B:
Regulation B, or the Equal Credit Opportunity Act (ECOA) ensures that creditworthy individuals have equal access to mortgage loans. While it does not have specific advertising requirements, it bars lenders from discriminatory practices considering age, ethnicity, gender, marital status, and nationality.
- Regulation N:
Regulation N is the Consumer Financial Protection Bureau’s (CFPB) Mortgage Acts and Practices in Advertising law. Its primary aim is to prevent deception in mortgage advertising, such as misrepresenting mortgage types, withholding interest rate variability, not disclosing consumer fees, and hiding fixed-rate mortgage changes.
- Regulation Z:
Regulation Z, or the Truth in Lending Law, provides consumers with actual costs, allowing for better credit terms and rate comparisons between lenders. This regulation mandates that ads disclose accurate information, including interest rates (both nominal and APR), and avoid misleading tactics.
By understanding these regulations, mortgage lenders can ensure compliance and build a trustworthy reputation with consumers.
Discover Six Proven Mortgage Advertising Strategies for Success.
Looking to make a lasting impression on your prospects? Here are six mortgage advertising strategies that work. While winning people over may take multiple engagements, consistency is key.
1- TV Advertising:
TV advertising can be a valuable option for mortgage brokers, but it can be expensive, and there’s no guarantee that your target audience will see your ad. However, if you have the budget, TV ads can enhance your reputation and brand. They are typically associated with larger, more established companies and may boost your credibility in the industry. Despite the cost, TV advertising remains a smart investment for brokers with the means to pursue it.
2- The Neglected Potential of Handwritten Direct Mail:
Direct mail marketing by handwritten means has gone unnoticed by many marketers compared to online platforms. However, they’re missing out, as studies have shown that it still ranks highest in the Return on Investment (ROI) for most industries. Moreover, handwritten messages are more tenable in the eyes of consumers, as people find those personal touches more captivating than typed text alone. As a result, these messages draw more notice, which presents an opportunity to distinguish oneself from the competition and gain attention.
3- Voicemail Messages:
In a highly competitive market, standing out is crucial to success. Real estate brokers know this, so crafting compelling voicemail messages is essential. However, not all messages are created equal. While established companies can do it effortlessly, amateurs may struggle with it. Thus, it’s vital to avoid common pitfalls, ensure your messages have a lasting impact, and encourage potential clients to call you.
Keeping your message too short is a common mistake. Providing enough information about what sets you apart from the competition and how you can help potential clients. This approach motivates them to return your call and learn more about what you have to offer. By following these tips, you’ll be one step closer to differentiating yourself from your competition and winning new business.
4- Radio Advertising:
Radio ads may be the go-to advertising option for big-city brokers, but did you know they could also be perfect for your niche and audience? With the right mix of elements, radio ads can be just as effective as their exclusive television counterparts at a fraction of the cost. Don’t miss out on the opportunity to reach your target audience. Let us show you how to create a winning radio ad campaign.
5- Social Media:
Social media platforms are ideal for sharing information and fostering engagement. Whether through Facebook, Twitter, or Instagram, creating content that sparks interest and encourages conversations is the key to success. Setting up a Facebook business page lets you showcase your company and write compelling posts that inspire shares and comments. This Drives traffic to your site and improves your search engine rankings. Share blog articles, run exciting contests, and stay connected with your customers in new and dynamic ways. With social media, the sky’s the limit.
6- Search Engine Optimization (SEO):
Search Engine Optimization (SEO) is a vital marketing tactic that amplifies your website’s ability to attract and convert traffic. Optimized website content makes your pages more likely to appear at the top of organic search listings, boosting your visibility and driving more traffic.
Unlike expensive pay-per-click (PPC) ads, SEO tactics are free and can be easily implemented on your website. By organizing your content effectively, creating valuable blog posts, submitting press releases, and building social media and backlink connections, you can increase your website’s search engine ranking and attract more online visitors.
Optimizing your website through SEO is a crucial strategy for growing your business. With it, prospective customers may be able to find you online. Moreover, SEO improves your user’s experience by helping them find the information they need more quickly and efficiently.
SEO best practices enable you to put important information at the top of the page and facilitate streamlined information flows. This reduces customer search time and results in visitors remaining on your website, increasing your chances of conversions. An optimized website can also significantly increase your chances of converting leads into loyal customers.
Discover How Social Media Channels Help Loan Officers Meet Fair Housing Requirements Through Audience Selection
Loan officers must stay up-to-date on fair housing rules and regulations when advertising mortgage services. Social media platforms can help through their audience selection tools. For example, Facebook requires Special Ad Audiences based on online behavior and activity similarities. This inclusive targeting approach avoids discrimination based on age, gender, or ZIP code. Additionally, avoiding language that implies personal attributes in the ads is essential. Stay compliant and reach a wider audience through social media channels.
Need Help?
After reading this blog post, you have a solid foundation for understanding mortgage advertising. You are now familiar with the various methods of marketing mortgages to prospective clients. The wide variety of approaches to reaching out makes it easier than ever to promote your product. With this comprehensive understanding, you are ready to work with an experienced agency that will help you drive traffic and bring in new business. GateHouse Agency has the knowledge and experience to create targeted campaigns that get results. Reach out today and see what we can do for you! Together, we can increase your leads and grow your customer base faster. Investing in a mortgage advertising plan now is the perfect way to ensure success in the future.
