(1) Am I responsible for ensuring that my advertising material is accurate, reliable, and in compliance with the act? Yes. Each mortgage broker is responsible for ensuring the accuracy and reliability of the advertising material.
(2) A licensee is prohibited from advertising with envelopes or stationery that contain an official-looking emblem designed to resemble a government mailing or that suggest an affiliation that does not exist. What are some examples of emblems or government-like names, language, or nonexistent affiliations that will violate the state and federal advertising laws? Some examples include, but are not limited to:
(a) An official-looking emblem such as an eagle, the Statue of Liberty, or a crest or seal that resembles one used by any state or federal government agency.
(b) Envelopes designed to resemble official government mailings, such as IRS or U.S. Treasury envelopes, or other government mailers.
(c) Warnings or notices citing government codes or form numbers not required by the U.S. Postmaster to be shown on the mailing.
(d) The use of the term "official business," or similar language implying official or government business, without also including the name of the sender.
(e) Any suggestion or representation that the solicitor is affiliated with any agency, bank, or other entity that it does not actually represent.
(3) Is it a violation to advertise that third-party services are "free" when the licensee has paid for the services?
Yes. Advertising using the term "free," or any other similar term or phrase that implies there is no cost to the applicant is deceptive because you can recover the cost of the purportedly "free" item through the negotiation process. This is a violation of RCW 19.146.0201
(2), (7), and (11). See the Federal Trade Commission's Guide Concerning Use of the Word "Free" and Similar Representations
(16 C.F.R. §251.1(g) (2003)) available at http://www.ftc.gov/bcp/guides/free.htm
(4) When I am advertising interest rates, the act requires me to conspicuously disclose the annual percentage rate (APR) implied by the rate of interest. What does it mean to "conspicuously" disclose the APR? The required disclosures in your advertisements must be reasonably understandable. Consumers must be able to read or hear, and understand the information. Many factors, including the size, duration, and location of the required disclosures, and the background or other information in the advertisement, can affect whether the information is clear and conspicuous. The disclosure of the APR must be as prominent or more prominent than any other rates disclosed in the advertisement, regardless of the form of the advertisement.
(5) The act prohibits me from advertising an interest rate unless that rate is actually available at the time of the advertisement. How may I establish that an advertised interest rate was "actually available" at the time it was advertised? Whenever a specific interest rate is advertised, the mortgage broker must retain a copy of the lender's "rate sheet," or other supporting rate information, and the APR calculation for the advertised interest rate.
(6) Must I quote the annual percentage rate when discussing rates with a borrower? Yes. You must quote the annual percentage rate and other terms of the loan if you give an oral quote of an interest rate to the borrower. TILA's Regulation Z, 12 C.F.R., Part 226.26 provides guidance for using the annual percentage rate in oral disclosures.
(7) May a mortgage broker or loan originator advertise rates or fees as the "lowest" or "best"?
No. Rates described as "lowest," "best," or other similar words cannot be proven to be actually available at the time they are advertised. Therefore, they are a false or deceptive statement or representation prohibited by RCW 19.146.0201
(8) When I advertise, or present a business card to a potential borrower, must I make the disclosures required under the act and these rules? No. You are not required to make disclosures until you accept a residential mortgage loan application, or until you assist a borrower in preparing an application.
(9) May I solicit using advertising that suggests or represents that I am affiliated with a state or federal agency, municipality, federally insured financial institution, trust company, building and loan association, when I am not; or that I am an entity other than who I am? No. It is an unfair and deceptive act or practice and a violation of the act for you to suggest or represent that you are affiliated with a state or federal agency, municipality, federally insured financial institution, trust company, building and loan association, or other entity you do not actually represent; or to suggest or represent that you are any entity other than who you are.
(10) If I advertise using a borrower's current loan information, what must I disclose about that information? When an advertisement includes information about a borrower's current loan that you did not obtain from a solicitation, application, or loan, you must provide the borrower with:
(a) The name of the source of the information;
(b) A statement that you are not affiliated with the borrower's lender; and
(c) The information disclosed in (a) and (b) of this subsection must be in the same size type font as the rest of the information in the advertisement.
[Statutory Authority: RCW 43.320.040
, 19.144.070, 2008 c 109. WSR 09-01-156, § 208-660-440, filed 12/23/08, effective 1/23/09. Statutory Authority: RCW 43.320.040
, 19.146.223. WSR 08-05-126, § 208-660-440, filed 2/20/08, effective 3/22/08. Statutory Authority: RCW 43.320.040
, 19.146.223, 2006 c 19. WSR 06-23-137, § 208-660-440, filed 11/21/06, effective 1/1/07.]