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Question: What compliance concerns are associated with posting reviews and using endorsements on websites and social media platforms?

Answer:

UDAAP can be a significant risk when publicizing a review or endorsement on a website, social media, or otherwise. A mortgage company must ensure that the reviews and endorsements it publicizes are real, accurate and do not mislead or deceive a consumer. To prevent fake or inaccurate reviews from being posted, a mortgage company should require written consent from the consumer prior to posting a review and to ensure it is accurate. Written consent may also be required by law, depending on the jurisdiction. 

A mortgage company should also examine the content of the review or endorsement prior to posting to ensure such content does not contain specific terms or superlative terms that could mislead a consumer. For example, a review/endorsement should not indicate the interest rate a consumer received or that it was the “best” or “lowest” rate since similar results cannot be guaranteed and may be based on specific qualifications. Mortgage companies must also ensure that they clearly disclose whether a reviewer/endorser received any payment or benefit for the review/endorsement and whether the reviewer/endorser was an actual customer. 

While a mortgage company may provide consideration for a review, that consideration must be provided for all reviews and not just “positive” reviews.  

The rise of social media and internet advertising has increased the prevalence of deceptive endorsements and fake online reviews. As a result, the Federal Trade Commission (FTC) recently issued Notices of Penalty Offenses to several hundred companies. These notices serve as a warning to businesses in general and should prompt mortgage companies to review their practices with regard to posting reviews and/or endorsements online.