Some mortgage lenders run misleading ads directed at veterans that promise special deals, imply VA approval, or offer a “no-payment” reverse mortgage to attract older Americans desperate to stay in their homes.
You should look out for and avoid loans that advertise:
- Official-looking logos implying that the loan comes from a government agency like the VA or the Department of Housing and Urban Development (HUD). Government agencies guarantee some loans, but they do not lend directly.
- Promises of amazingly low rates. Offers of rates as low 1.9 percent for “VA refinancing” may turn out to only be in effect for a short period of time.
- Promises that a reverse mortgage will let veterans stay in their home payment-free. Typically, borrowers with these mortgages must still pay their taxes and insurance and could lose their homes if they don’t.
- Announcements of “pre-approval” and large amounts of cash or credit available to you. Generally, there’s no guarantee that a borrower will be approved for a loan or approved for a loan of a particular size this early in the process.
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