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CFPB examines fraudulent mortgage ads for Veterans, seniors

11.20.2012

Some loans offer rock-bottom mortgage rates for Veteran and senior borrowers.

Fraudulent mortgage advertisements can target anyone, but Veterans and senior borrowers may be especially susceptible.

This is why the Consumer Financial Protection Bureau, along with the Federal Trade Commission, recently announced a new initiative to target fraudulent mortgage ads tailored for former members of the armed forces and older Americans.

"If it sounds too good to be true, it probably is," the CFPB said. "Some advertisers will use your military or veteran status as a way to approach you, promising special deals or implying VA approval."

Although agencies, such as the Department of Veteran Affairs and Department of Housing and Urban Development, back mortgages, they don't directly lend to consumers. With this in mind, when a loan advertisement bears a seal from the VA or HUD, borrowers should be wary.

Some loans offer rock-bottom mortgage rates for Veteran and senior borrowers. However, if they read the fine print they may come to find that after a period of time, their interest rate could increase, resulting in more expensive mortgage payments. Borrowers who do not properly budget for these added costs could find themselves falling into delinquency.

This is a promising development for the mortgage industry, as it could make lending safer for a number of consumers.

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