Skip to main content

CFPB Takes Action Against Reverse Mortgage Lender for Deceptive Advertising

Apr 28, 2021
CFPB Logo

The Consumer Financial Protection Bureau took action against Nationwide Equities Corporation for sending deceptive loan advertisements to hundreds of thousands of senior borrowers. The advertisements purposefully misled borrowers about the return they could get from a reverse mortgage, the fees and costs associated with the products, and the consequences of nonpayment, according to the CFPB consent order. Now, CFPB is ordering Nationwide Equities to pay a $140,000 civil penalty and implement a compliance plan to review every one of their advertisements and ensure they do not violate federal law.

The advertisements and letters by Nationwide Equities included hidden costs, hidden risks, false existing relationships, and false pre-approvals. The CFPB found that Nationwide Equities had multiple MAP Rule violations by misrepresenting fees, costs, payments, taxes and insurance. Other misrepresentations include: Potential for default and right to reside in the dwelling, association of the product or provider, available cash or credit, and likelihood to obtain a particular term or refinancing. 

CFPB acting director, Dave Uejio, said, "Reverse mortgages are complicated financial obligations that require careful consideration. Today’s action underscores the Bureau’s commitment to helping protect older homeowners from unscrupulous companies."

Nationwide Equities’s advertisements violated the Mortgage Acts and Practices Advertising Rule (MAP Rule), the Truth in Lending Act (TILA), and the Consumer Financial Protection Act of 2010 (CFPA), according to the CFPB. The company, headquartered in Mahwah, New Jersey, is one of the largest reverse mortgage lenders in the United States, licensed in 17 states and the District of Columbia, and operates three retail branches across the country.

Published
Apr 28, 2021
More from
Reverse
Opportunities In Reverse 

For seniors who still have a mortgage, 40% are looking to use the equity they’ve built to eliminate their monthly payment. 

Reverse
Oct 19, 2021
HECM Endorsements Plummet More Than 14 Percent

Home equity conversion mortgage endorsements plummeted 14.3% in August 2021 to 3,679 loans.

Reverse
Sep 14, 2021
Reverse Mortgages Aren't Expanding Into Broader Mortgage Business

The reverse mortgage sector has remained strong accounting for more than 4,000 loans a month, according to Reverse Mortgage Daily, however, growing the business further has been on the back burner.

Reverse
Jul 28, 2021
FHA Adds COVID-19 Recovery Options For Forward And Reverse Borrowers

The Federal Housing Administration announced additional COVID-19 recovery options to help both forward and reverse homeowners who are facing hardships as a result of the pandemic.

FHA
Jul 26, 2021
RMF Revamps Its Borrower Qualification Process To Increase Efficiency

Reverse Mortgage Funding, LLC (RMF) is taking a new approach to the borrower qualification process for those seeking a reverse mortgage. The process was created to drive efficiency during the approval process and increase reverse mortgage market growth.

Reverse
Jul 20, 2021
Reverse Mortgage Endorsements Slide By More Than 4 Percent In June

Reverse mortgage endorsements decline by 4.4% to 4,160 loans, increasing the streak of more than 4,000 loans per month, according to Reverse Mortgage Daily.

Reverse
Jul 06, 2021