A consumer-friendly marketplace is a top goal for AARP, and our advocacy takes many forms. In state capitals and Congress, we fight to make sure consumers are treated fairly in legislation and rulemaking and get the information they need to make good choices. AARP also serves as a marketplace advocate by providing a wide range of useful information—ranging from scam alerts to tips on smart purchasing—and selectively endorsing products that save money and offer value.
Regulation and Enforcement
Consumers benefit when markets operate fairly and effectively, leading to competition on price and choice. We try to make sure the watchdogs do their jobs. Protecting consumers requires effective regulatory oversight across the broad range of American business, including financial, health care, energy, housing, communications and other industries. Financial scams and misleading investment advice can threaten a family’s life savings and underscore the need for strong regulation and enforcement. AARP supports the creation of the Consumer Financial Protection Bureau. Our advocacy and oversight is important to make sure that future rules and policies reflect the spirit of the law. We will continue to push for effective regulation of mortgages, including nonbank mortgage lenders, debit cards, credit reports and other consumer financial issues.
Utilities may pose special concerns for older households, which is why AARP vigilantly scrutinizes rate decisions in all 50 states. Regulators have a duty to make sure rates are fair, markets are transparent, and services are accessible. Cut-offs should only be a last resort employed after due process. Efforts to deregulate electricity markets must include protections to shield consumers from price shocks. Utilities must remember their responsibilities to the public they serve, and not just their investors.
Home buyers fall behind in their payments for many reasons, including falling house prices that can make it difficult to sell a home for more than the mortgage amount, not understanding the features of a mortgage, and over-committing available income. Unscrupulous marketing, in which buyers are steered into unsuitable loans, is an important reason for mortgage delinquencies, particularly among inexperienced consumers and those with little education. To reduce potential problems, lenders should provide applicants with clear-cut disclosures about potential interest-rate hikes, prepayment penalties and any other mortgage feature that can raise unanticipated costs. Where problems already exist, AARP calls on lenders to modify loans, in order to lighten the load on strapped borrowers. Foreclosure is a drastic measure that should be avoided in all but the most dire situations.
An Educated Consumer
Consumers need the best possible information to navigate a complex marketplace that features vast choice and a rapid stream of new technologies. Less-than-obvious costs should be clearly disclosed, as well as details about safety, service and warranties.
Consumers also should do their homework. In particular, we urge people to ask questions about the full costs and risks in any financial transaction, including reverse mortgages, home refinancing, and purchases of financial instruments. To help meet this need, AARP supports a major effort to enhance financial literacy.
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