I saw an ad for a no-payment reverse mortgage from the Department of Veterans Affairs (VA). Is this legitimate?
No. The VA does not offer no-payment reverse mortgages.
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.
If you have a problem with a reverse mortgage, you can:
- Connect with a U.S. Department of Housing and Urban Development (HUD)-approved housing counselor.
- Submit a complaint with the CFPB online or by calling 1-855-411-CFPB (2372).
- Consult an attorney. If you need help finding an attorney, you can view this information which includes a list of legal aid services in your state, or you can find lawyer referrals in your county and state by visiting your local or state bar association’s website.