Where's the Fine Print? Advertising and the Mortgage Market Crisis

摘要

Current conditions in the U.S. mortgage industry provide a rich context for exploring the positioning and information used in advertisements for mortgage products. This article examines television, radio, and print advertising messages employed to promote prime and subprime mortgage products. An analysis of these advertising messages reveals marked differences in the marketing for prime and subprime mortgage offers. Prime mortgage market advertisements tended to emphasize 'the American dream of homeownership' and low rates, and often provide detailed loan terms. On the other hand, subprime loan advertisements were based on fear appeals, emphasizing debt problems and encouraging consumers to rely on the lender/broker for help. These important differences in the information available to consumers for various mortgage products may have exacerbated industry information asymmetries and contributed to the current mortgage crisis.