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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:

  1. Connect with a U.S. Department of Housing and Urban Development (HUD)-approved housing counselor.
  2. Submit a complaint with the CFPB online or by calling (855) 411-CFPB (2372).
  3. 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.