You’ve heard the saying before: “If it sounds too good to be true, it probably is.”
That’s exactly what the Consumer Financial Protection Bureau (CFPB) and the U.S. Department of Veterans Affairs (VA) are warning about in a recent joint statement.
Both agencies say some lenders are using misleading refinance ads to target veterans and service members who have VA home loans.
These offers often look official — sometimes even using the VA seal — but they can cost you thousands of dollars over time.
Why the CFPB and VA Issued This Warning
The CFPB and VA found that some lenders were sending out letters that:
-
Looked like they came from the VA or a government office,
-
Promised big savings or fast cash, and
-
Used high-pressure tactics to get veterans to refinance quickly.
In reality, these offers often add extra costs and fees to your loan. That can leave you paying more in the long run — even if your monthly payment goes down.
The Problem: Refinance Offers That Sound Too Good to Be True
According to the CFPB, many veterans were being “churned” — refinanced over and over again.
Each time a refinance happens, new fees and interest are added to the loan balance. Over time, those costs erase any short-term savings.
If you’ve seen ads promising:
-
Super low interest rates
-
Cash back or “escrow refunds”
-
Skipped payments or no closing costs
…you should pause and ask questions before signing anything.
Red Flags to Watch Out For
Here are the warning signs the CFPB and VA say to look out for:
🚩 “Skip one or two mortgage payments!”
Those “skipped” payments aren’t free. They’re added to your loan balance and increase your total debt.
🚩 “Get an escrow refund!”
This refund isn’t new money — it’s money already in your escrow account that will just be re-added later.
🚩 “Unbelievably low interest rate!”
Be careful if the ad doesn’t clearly state the loan terms or whether you’ll pay points to get that rate.
🚩 Aggressive or pushy sales tactics
If someone pressures you to act immediately or claims the offer expires soon, that’s a major red flag.
What “No-Cost” or “Skip Payments” Really Means
Many mailers advertise “no out-of-pocket costs” or “no closing fees.”
That doesn’t mean there are no costs — it means the fees are rolled into your new loan.
For example:
-
You “skip” two payments ($3,000).
-
You add $5,000 in closing costs.
-
You now owe $8,000 more — even though your payment might drop $100 a month.
You’ve just traded short-term comfort for long-term debt.
Always ask your lender for a Loan Estimate (LE) that breaks down every cost before agreeing to refinance.
Smart Ways to Protect Yourself
If a refinance offer seems too good to be true, follow these steps:
-
Check the lender’s credentials. Look for a valid company name and NMLS number.
-
Compare multiple quotes. Request Loan Estimates from at least two trusted VA lenders.
-
Ask detailed questions. What’s the total cost? Are fees added to the loan?
-
Know the VA refinance rules. You must wait 210 days and make six payments before refinancing again.
-
Talk to a Vetted VA professional. These are verified experts who know VA loan rules and will always put education before sales.
How to Stop or Reduce Unwanted Offers
You can reduce the number of refinance offers you get by:
📞 Calling 888-5-OPTOUT (888-567-8688)
💻 Visiting optoutprescreen.com
☎️ Adding your number to the National Do Not Call Registry at donotcall.gov or calling 888-382-1222
These steps won’t stop every letter or call, but they’ll make a big difference.
Trust Experience — Not Empty Promises
A real VA lender will never pressure you, and they’ll take the time to explain the pros and cons of refinancing.
At Vetted VA, our professionals are trained to protect veterans through clear, honest guidance — not quick sales.
If you ever get a refinance offer that feels off, post it in the Vetted VA Facebook group. Our verified experts can help you understand what’s real and what’s risky.
Knowledge is your best defense. The more you understand your VA loan, the harder it is for bad actors to take advantage of you.
Questions?
