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Mortgage ads without credibility: “ZIP. ZERO. NADA.”

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If you’re looking for a mortgage, ads for “$0 money down” may be tempting. But if they hide fees or don’t disclose the true terms of the deal, they’re misleading, and they violate the law. In fact, the FTC recently settled charges with a Pennsylvania homebuilder that deceived consumers with ads for low-cost mortgages that hid fees and didn’t disclose vital information about the true cost of the mortgages.

Heritage Homes Group ads deceptively said homes were available for “ZIP, ZERO, NADA” “$0 money down” and “$0 paid for closing costs.” In fact, the program required payment of a minimum $2,000 deposit, a 2% funding fee, an annual fee and other charges. Some ads promoted a specific monthly payment amount, but didn’t reveal the restrictions on who could qualify for that amount or fees involved. The ads also failed to disclose, or clearly disclose, the annual percentage rate for the financing.

Under the settlement, Heritage Homes Group is barred from making further deceptive claims, among other terms. The settlement also imposes a $650,000 penalty on Heritage, which is suspended based on ability to pay.

When you shop for a mortgage, it’s important to understand all the terms and conditions of a proposed loan. You’ll want to compare all the costs involved in getting a mortgage and get information from several lenders or brokers. Use this worksheet to record the details. Certain buzzwords often appear in deceptive mortgage ads; if you hear about “super-low rates” or “no money down,” be ready to ask follow-up questions.

Blog Topics: 
Homes & Mortgages


Excellent information for the home buyer and I am glad to see Heritage Homes Group got caught and has to pay a fine. This sort of misleading the public is going on everyday and needs to stop.

i cannot believe you are not investigating nationstar mortgage the terrerist from dallas texas they are scamming thousands and thousands go to nationstar complaints and reviews see for yourself stop them before they start the next mortgage crisis i hate them so much some people dont buy things from china i dont buy aqnything made in texas

Can you tell me if you have a deceptive claim for citifinancial. I borrow ed 130,000 part went bankruptcy because of my grankids they told me they couldn't reduce this high interest rate unless I was a couple of payments behind, then they tried to forclose on me I borrowed the money they went threw the court and said I didn't qualify for help. I have been discharged from bankruptcy and I can't get any releif please tell me what can I do I asked what is the payoff I'm paying double they tell me there is no payoff

I had a similar situation with Pennymac. They told me I did not qualify for any programs for assistance until I was behind on my payments and now they say I need to borrow the money to pay the amount I am behind or I'm subject to forclosure.

I was applying for an apartment, and told to give them a check or money order for $300.00 and told a coue of hours later that I didn`t qualify , and they would not refund my money! I am going to sue them for $ Thousands !!

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