Refinance scams target military vets
The federal government is investigating a number of predatory lending schemes targeting thousands of veterans who have Veterans Administration mortgages. Officials say the scams aim to convince borrowers to repeatedly refinance, ultimately paying more on their loans. Some lenders also are being accused of using teaser interest rates, “cash out” windfalls, and lower monthly payments, using marketing materials that sometimes resemble Department of Defense information.
The VA warned that lenders who make “improper charges or fees” that lead to foreclosure will face stiff penalties. The Consumer Financial Protection Bureau plans to fine and sue lenders who propagate these abuses.