Crain's New York Business
August 4, 2003
New York, New York

Suffering ad nausea

Michael Moskowitz sees red when he reads the mortgage ads in New York's daily tabloids.

The Ukrainian-born mortgage banker, president of Equity Now, frets about what he sees as misleading ads in the Post and Daily News, which imply that borrowers can ''lock in'' ultra-low floating-rate mortgages. By definition, they don't permanently lock; they float. And he rages when he sees advertised rates that are what he calls "underwater"--too low for the companies offering them to make money, if they actually close any loans at those rates.

''It's classic bait-and-switch,'' Mr. Moskowitz says.

He complained to the tabloids in 1997 that mortgage brokers were implying in ads that they were lenders, and he convinced the papers to keep a lookout for anything misleading. But Mr. Moskowitz says he has noticed more questionable stuff creeping into the real estate ads, and has resumed his complaints.

Apparently, he's getting heard again. Last month, Marie McGovern, the Daily News' real estate advertising manager, sent a letter to mortgage advertisers telling them that they need to comply with state banking regulations, and inserted helpful excerpts from the regs.