Among the many Super Bowl ads aired this past Sunday, one drew the ire of the Consumer Financial Protection Bureau. Quicken Loans spend an estimated $5 million to advertise a new mortgage loan program to an estimated 112 million Americans. The CFPB took to Twitter within minutes of the ad airing. The ad can be found here.
Quicken was advertising a new mortgage loan program called “Rocket Mortgage,” which they say will simplify and speed up the process of obtaining a mortgage loan. Quicken is the third-largest mortgage lender in the United States. The “Rocket Mortgage” product promises to cut loan officers out of the equation and qualify borrowers online in less than 10 minutes. Borrowers could then lock in an interest rate. The website analyzes customers’ financial and credit history to determine loan eligibility. As the ad’s voice-over wonders:
“What if we did for mortgages what the Internet did for buying music and plane tickets and shoes? You would turn an intimidating process into an easy one. You could get a mortgage on your phone. And if it could be that easy, wouldn’t more people buy homes?”
The CFPB was quick to insinuate a connection between products like Quicken’s and the subprime crisis of 2008 in its Tweet:
“When it comes to #mortgages, take your time, ask questions and #knowbeforeyouowe. http://go.usa.gov/cy2EJ.”
Quicken responded in kind on their Twitter feed.
“@CFPB We agree. No better way than #RocketMortgage for full transparency into mortgage options & info needed to make the right decision. ”
Bill Emerson, Quicken’s CEO, told Yahoo news the next morning that he emphatically rejected assumptions that “Rocket Mortgage” would approve subprime borrowers, saying it’s “simply not true. We don’t do subprime and we’ve never done subprime [lending],” he said. “If [borrowers] don’t qualify for a mortgage, they can’t get a mortgage.”
Emerson brushed off the criticism. “There’s going to be controversy anytime you’re doing something new and different that many people may not understand,” he said. “What we’re doing is taking an intimidating process and making it more efficient and more easy for people to understand.”
The product establishes the mortgage loan, but the “Rocket Mortgage” website is clear that there is more to the process of buying a home. Borrowers still need to arrange an appraisal and additional steps like home inspection could slow the process down as well. Most loans close within 30 days, Quicken says.