National Mortgage Company To Alter "No Closing Costs" Ads

The Arizona Daily Star reports:

• A national mortgage firm known for its extensive radio advertising campaign has agreed to make changes to its marketing. Lenox Financial Mortgage has agreed not to claim the company can provide loans with "no closing costs" unless it also discloses that not everyone will qualify. An "assurance of discontinuance" signed by company President John Shibley and filed in Maricopa County Superior Court says any future advertising will include disclaimers and other qualifying information.

• [Arizona] Attorney General Terry Goddard acknowledged that a majority of the company's customers were, in fact, offered mortgages that refinanced existing loans without closing costs. But he said that wasn't the case universally.

Shibley, in his ads, has called the idea of no-fee mortgages "the biggest no-brainer in the history of Earth."

As part of the agreement with the Arizona AG's office, Lenox agreed to foot the $95,000 bill for the cost of the AG's investigation. For more, see Lenox mortgage to alter 'no closing costs' ads.

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