Without audience targeting are Google Ads Dead? Think again…
Early this month Google announced new restrictions for targeting specific audiences. The restrictions apply to content related to housing, employment, credit, and those who are disproportionately affected by societal biases. The news of these restrictions created quite a stir among industry brokers and lenders who heavily rely upon targeted Google ad campaigns. All which may have you asking if these changes will kill future reverse mortgage advertising on the world’s most popular search engine. In just a moment we’ll hear from our online SEO expert Josh Johnson to find out.
Google’s restrictions are not necessarily novel nor unexpected. It was just over two years ago Facebook faced scrutiny from federal regulators for allowing those offering credit or housing finance to restrict ad audiences by race or religion among other questionable metrics that would violate HUD’s fair housing rules. An investigation by ProPublica broke this news in October 2016. It was nearly two years later in August 2018 that HUD filed a formal complaint against the social media giant for discriminatory advertising practices. Seven months after HUD’s complaint Facebook announced sweeping changes. Both Facebook and later Google, took a blunt approach much to the chagrin of lenders and service providers.
What ad filters are going away? In its official release Google revealed, “credit products or services can no longer be targeted to audiences based on gender, age, parental status, marital status, or ZIP code.”
Is this the end of Google ads for reverse mortgages? To answer that question I reached out to Josh Johnson who heads up Reverse Focus’ Online Dominance SEO program and Google marketing. Here’s his explanation.
Here’s what makes Google unique from other platforms and why reverse mortgage Google ads will continue to reach the intended audience.
To summarize, older homeowners are intentionally seeking out reverse mortgage information on Google which means, yes-your ads will be seen by your target audience, even though you can no longer target specific age groups.
The ‘Debt-Elimination’ Fallacy in reverse mortgages
If you are telling potential borrowers that their reverse mortgage will pay off debts you are only partially correct. Even worse making the same claim to a financial professional could undermine your credibility. The truth is a reverse mortgage borrower’s existing debt may be transferred AND converted. Transferred on the ledger from an auto lien holder or credit card company TO a reverse mortgage. Converted from loans that require consistent payment to a loan in which the borrower can defer payments for any period of time- until they move, break the terms of the loan, or the last borrower dies.
Why are such distinctions important you may ask? Because the language you use while descriptive and engaging must remain accurate lest you discredit yourself, not to mention it could culminate in regulatory enforcement actions. If you doubt that take note of section 1014 subsection 3 of the CFR or Code of Federal Regulations which addresses prohibited representations.
“It is a violation of this part for any person to make any material misrepresentation, including but not limited to…
(m) The effectiveness of the mortgage credit product in helping the consumer resolve difficulties in paying debts, including but not limited to misrepresentations that any mortgage credit product can reduce, eliminate, or restructure debt or result in a waiver or forgiveness, in whole or in part, of the consumer’s existing obligation with any person.” To be fair it could be argued that a reverse mortgage does in fact restructure existing debt, just as I did in the opening of the show, however marketing the loan in this manner would be ill-advised.
If you’re ever tempted to tout debt-elimination as a benefit keep this in mind.
In 2016 a Consent Order was issued by the CFPB against one reverse mortgage lender; it focused claims of debt elimination in advertising and marketing. What is a consent order? According to the Bureau’s website, consent orders detail the CFPB’s findings on violations and typically impose injunctive relief, monetary relief, penalties, and reporting. The Order findings said, “In truth and in fact, a reverse mortgage does not eliminate all of a consumer’s debt; a reverse mortgage is debt and, as a result, cannot be used to eliminate all of a consumer’s debt.”
Dan Hultquist of Understanding Reverse put it this way, “You are replacing debt with an equal or larger liability. You’re borrowing from Peter to pay Paul, but Peter has low interest rates and very favorable payment terms.” In avoiding potential misleading claims he said, “The reverse mortgage stands alone as a great potential solution without an originator overselling it. Such statements put the originator in a defensive position”. When speaking with a financial advisor if you argue that a reverse mortgage eliminates existing consumer debt- you could easily be challenged to back up that statement or even dismissed as another salesman making outlandish claims. The same can be said if you claim that the loan creates income- which it doesn’t because income actually increases one’s assets.
Are such distinctions hair-splitting? Absolutely not. The specificity of the words you use as a reverse mortgage professional not only avoid regulatory sanctions but build up the credibility of reverse professionals seeking to make inroads with trusted advisors.