AAG, also known as American Advisors Group, is widely recognized as the nation's largest provider of reverse mortgages, based in Irvine, California. However, its operational history also includes significant regulatory action due to deceptive advertising practices.
Who is AAG?
Based in Irvine, California, AAG has established itself as the largest provider of reverse mortgages across the nation. Reverse mortgages allow homeowners, typically seniors, to convert a portion of their home equity into cash. Repayment is generally deferred until the borrower moves out, sells the home, or passes away.
Regulatory Findings and Consumer Protection
A notable event in AAG's history involves an administrative consent order issued against the company in 2016 by a regulatory Bureau. This action was taken to address specific findings that AAG had engaged in deceptive advertisements.
One of the key issues identified was AAG's false claim that consumers could not lose their homes after securing a reverse mortgage. This statement is misleading because, despite obtaining a reverse mortgage, borrowers are still obligated to pay property taxes, homeowners insurance, and maintain the property. Failure to meet these ongoing responsibilities can indeed lead to foreclosure. The consent order was implemented to correct these misleading practices and ensure greater transparency and accuracy in information provided to consumers considering reverse mortgage products.
