Bank Of America Revives Deceptive Loan Advertising Practices

About six months after the government warned lenders against deceptive mortgage advertising, Bank of America is using a misleading pitch and copious fine print to sell borrowers on refinancing plans. The American Banker reported Monday that a mailer from the bank in New Jersey “sounds eerily like a sales pitch from the bubble days of 2005.”

While the mailer touts annual savings of more than $4,000, National Consumer Law Center attorney Andrew Pizor says the refinancing offer would add more than $37,000 to the cost of a borrower’s loan. “I think the pitch is kind of deceptive because it boldly mentions ‘save’ and ‘savings,’ repeatedly, and of course it refers only to the higher interest rate and overall loan amount in the footnotes,” Pizor told the American Banker.

There’s a full page of footnotes in the mailer, in “small type with several disclaimers,” and the American Banker found multiple bank lawyers willing to defend the deceptive pitch because “it discloses everything.” The story includes an image of the mailer:

In November, the Consumer Financial Protection Bureau (CFPB) sent warning letters to about a dozen mortgage lenders and brokers warning them that they should clarify potentially misleading advertisements. Those ads may run afoul of a 2011 rule against misleading advertising by financial companies. The CFPB wouldn’t comment on Bank of America’s mailer, but the rule in question specifically states that “a fine print disclosure at the bottom of a print advertisement…is unlikely to qualify a claim effectively.” Consumers can submit complaints around such advertising using tools on the CFPB and Federal Trade Commission websites.


Bank of America has a long track record of abusive consumer practices, including robo-signing mortgages, pursuing foreclosures while also working with homeowners on loan modifications, and actively preventing its borrowers from getting help with their mortgages. The bank bought Countrywide, perhaps the largest predatory lender of the subprime era, in early 2008.