Adjustable Rate Mortgages: Where Has All the Advertising Gone?

We are in the middle of what has been called a Mortgage Meltdown. With adjustable rate mortgages causing a high than ever foreclosure rate, it seems that even the big and powerful mortgage companies have disappeared. Over the last 5 to 7 years you could not turn on the radio, TV, open a magazine or newspaper or even drive down the street without being inundated with advertisements for low rate mortgages of every type. Lately advertising in the mortgage industry has been about timing and frequency not about loyalty or needs. It also seems that most mortgage advertising has been about forcing a particular type of loan product on an unsuspecting and unwary public.

Now as the mortgage industry has tightened its requirements, companies that were advertising everyday and every hour have withdrawn large amounts of advertising. My favorite television commercials are now about cheap insurance and not cheap mortgages. I even took a look back at a taped program from several months ago and there were 3 minutes less advertising in the same program time slot yesterday. This must be causing some real problems in revenue for advertising companies. NASCAR is suffering from pulled sponsorships, the PGA is suffering from lost revenue, local newspapers have lost national accounts and local advertising from major sources.

Marketing for the mortgage industry has always been very powerful in shaping our thoughts and attitudes about the real estate market. Now that mortgage marketing has become a failing dinosaur even small local companies who benefited from the national budgets of large lenders are feeling the crunch. This all seems to be fallout from poor and irresponsible selling of individual loan programs instead of using advertising to educate and make lifelong clients.

Adjustable rate mortgages seemed to lead the way for several years in the total amount of advertising dollars spent. Then for the last couple of years extremely low teaser rates have been the right of passage for most companies. While loan programs with very low initial rates cause a lot of interest they are actually right for very few customers. Much like the old bait and switch tactics of retail and car dealers of the past, these advertising tricks are now costing people their homes.

Mortgage lenders have cut their advertising way back. This is their way of saying we can't help everyone anymore. We could have helped you and we may have been there in the past but we aren't going out on a limb to support you. It seems the industry is saying Mr. Consumer, you asked for a product, we gave you a product and you used it irresponsibly. Maybe there is some truth to that statement. But in a confusing industry like mortgages, consumers need companies and consultants that they can trust.

Advertising is meant to draw you in to a particular business. Regardless of that business you as the consumer need to be aware of all the details of your financial transactions. As a consumer the best thing you can do is to be informed and with all the information available today that can be confusing. So the next thing you must do is to make sure you ask for and talk to any referrals that the company may have. Mortgages are a tough business and interest rates and payments may not always be the most important thing to consider when talking about your home. You wouldn't consider a discount heart surgeon would you?