Ameriquest Capital Corp. has spent hundreds of millions to build name recognition for its mortgage companies over the last two years -- inking high-profile deals with pro baseball, football and auto racing, and sponsoring the Rolling Stones on their current U.S. tour.
The slogan for its Ameriquest Mortgage unit -- "Proud Sponsor of the American Dream" -- pays homage to its business of making home loans.
What neither the slogan nor the branding campaign says, however, is that Orange-based Ameriquest is almost entirely a supplier of "sub-prime" refinancings for homeowners who may not be able to get lower-cost prime loans because of bad credit, an inability to document their income or other financial issues.
Consumer advocates have complained for years that some people with good credit are often steered into more expensive sub-prime loans. The Ameriquest branding campaign -- with its broad slogan and lack of references to its sub-prime specialty -- is likely to attract many prime-worthy borrowers who don't realize that the company doesn't offer traditional mortgages, said Norma Garcia, a senior attorney for Consumers Union.
"They are clearly advertising to the prime market," Garcia said. "They're saying that they are for everyone -- and I think that's true. They're not going to turn anyone away just because they could qualify for a better prime loan."
Gary Ruskin, executive director of Commercial Alert, a consumer group based in Portland, Ore., called it "broad-spectrum marketing of predatory loans."
Ameriquest officials contend these critics miss the point. The branding is not a stand-alone tactic but a supplement to direct-marketing efforts, including mailers that are sent directly to potential borrowers who have credit problems, said Kevin Morefield, the company's executive vice president for strategic planning.
Responses to direct-mail pitches jumped the day after Ameriquest ran TV ads during the Super Bowl this year, Morefield said, indicating that more recipients were opening the envelopes instead of chucking them into the trash.
Morefield said the company was aiming to expand beyond its traditional base of refinancing homes so borrowers could pay off debts such as credit cards or get some cash. As a step toward offering a full range of mortgages, Ameriquest this year introduced several new loan types aimed at home purchasers and refinancers who have good credit scores but can't get traditional prime loans because of other issues, he said.
