Instagram Rate Ad for a Bedford Loan Officer
Priya is an MLO at a licensed New Hampshire mortgage broker. She posts on Instagram: "GUARANTEED LOWEST RATE - 3.125% (APR 3.20%)! ZERO lender fees. EVERYONE APPROVED. DM me. NMLS #123456. Equal Housing Opportunity." The 3.125% rate is a 15-year conforming loan with 2 discount points for borrowers with 740+ scores and 20% down; it is not available to most viewers. The post does not name her sponsoring broker or include the broker's NMLS ID. She also asks three past clients to post five-star reviews naming their loan amounts, employers, and credit scores. Priya has 18 months of experience and no disciplinary history. A competitor forwards the post to the New Hampshire Banking Department.
1. Identify the misleading or prohibited elements in Priya's post and explain why each matters under New Hampshire law.
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Several elements are problematic. "Guaranteed lowest rate" is an unverifiable superiority claim, and "everyone approved" is false because the advertised terms require a 740 score and 20% down. The rate is a trigger term, so the ad must clearly disclose the APR, points, down payment, and repayment terms; stating an APR without the qualifying conditions is misleading. "Zero lender fees" is inaccurate if two discount points are charged. Omitting the sponsoring broker's name and NMLS ID obscures who is legally responsible. Under RSA 397-A and the New Hampshire Consumer Protection Act, mortgage advertising must be accurate and not create a misleading impression about availability, cost, or approval. A first-time violation does not excuse deceptive content; the Banking Department can review advertising as part of licensing oversight.
2. What corrective steps should Priya and her broker take?
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They should remove or correct the post immediately and issue a corrected advertisement that names the licensed broker, includes the broker's NMLS ID, states the APR and points, and describes the credit and down-payment conditions. They should not simply add a small disclaimer if the headline remains false; the overall impression must change. The broker should review Priya's other social media, scripts, and flyers for similar claims, document the review, and train her on trigger terms and approval claims. Because the post was publicly distributed, the broker should preserve a copy and a record of the corrective action in case the Banking Department asks. If the post generated applications, the broker should review those files for inaccurate disclosures and consider whether borrowers relied on unavailable terms.
3. What is the problem with the client reviews naming loan amounts, employers, and credit scores?
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The reviews disclose nonpublic personal information from the loan files. Even if the clients volunteered the information, an MLO and broker have privacy and confidentiality obligations and should not solicit or publish loan-level details without written authorization. Publishing employer names and credit scores also creates a risk of identity disclosure in a small market. The reviews can be used, but they should be limited to general statements about service, with written consent and without confidential financial details. Soliciting only positive reviews is less problematic than scripting false ones, but the broker should ensure the reviews are genuine and not a condition of service. This issue is separate from the rate-advertising violation and should be corrected in the same review.