Regulation N – Mortgage Acts and Practices – Advertising was issued by the Consumer Financial Protection Bureau (CFPB) to implement requirements of the Credit Card Accountability and Responsibility and Disclosure Act of 2009 (CARD Act) and Dodd-Frank Wall Street Reform and Consumer Financial Protection Act of 2010 (Dodd-Frank Act). The Federal Trade Commission oversees compliance with Regulation N for entities over which it exercises jurisdiction.
Regulation N defines mortgage credit product as any form of credit that is secured by real property or a dwelling and that is offered or extended to a consumer primarily for personal, family, or household purposes. For a mortgage credit product, the regulation prohibits certain material representations in any commercial communication about any term of a mortgage credit product, including:
The interest charged for the product – amount of interest in the monthly payment, loan amount, or total amount due;
The annual percentage rate, simple annual rate, periodic rate, or any other rate;
Information about the existence, nature, or amount of fees or costs to the consumer for the mortgage credit product;
Information about the existence, nature, or amount of fees or costs to the consumer for any additional product that may be sold in conjunction with the mortgage credit product;
The terms, amounts, payments, or other requirements relating to taxes or insurance associated with the mortgage credit product;
Any prepayment penalty associated with the mortgage credit product;
Any comparison between a rate or payment that will be available for a period less than the full length of the mortgage credit product and an actual or hypothetical rate or payment;
The type of mortgage credit product;
The amount of the obligation and the nature of cash or credit components of the obligation;
The existence, number, amount, or timing of any minimum or required payments;
The potential for default under the mortgage credit product and circumstances of default;
The effectiveness of the mortgage credit product in helping the consumer resolve difficulties in paying debts;
The association of the provider of the mortgage credit product with any other person or program;
The source of any commercial communication about the mortgage credit product;
The right of the consumer to reside in the dwelling that is the subject of the mortgage credit product;
The consumer’s ability or likelihood to obtain any mortgage credit product or term;
The consumer’s ability or likelihood to obtain a refinancing or modification of any mortgage credit product or term; and
The availability, nature, or substance of counseling services or any other expert advice offered to the consumer regarding any mortgage credit product or term..
