You should be aware of these schemes in case someone asks you to participate, or in case you see fraudulent activity. Indicators of potential fraud include the following:

  • Be wary of high interest rates on home and car loans.
  • Avoid any loan asking for money up front. Legitimate lenders will charge you a fee after your loan has been approved, not before.
  • Lender who is promoting or pressuring you to take a loan with a Variable Interest Rate when they know that you may not have the financial income to repay the loan when the interest rate increases.
  • Bad actors will offer loans without credit checks often targeting those with bad credit or debt problems. If the lender is not asking for a credit check it may not be a valid offer.

Tips to Avoid Scams

Do’s

  • Validate: If you are interested in working with a Veteran Service Organization (VSO), agent, or attorney, use the Office of General Counsel accreditation tool to confirm and validate their credentials.
  • The VA can assist you if you are falling behind on payments and need financial assistance instead of falling for a scam for help. There are several areas to seek assistance, including the VA Loan Guaranty service, which provides special loan rates for Veterans seeking to purchase homes using VA mortgage financing. Contact the VA directly to assist you with managing your debt.
  • Things scammers say to take advantage of you.
    • Everyone gets approved. Bad credit – no problem.
    • Reduced interest rate loans.
    • Special loan terms for Veterans.

Don’ts

  • Avoid payday or title loans – these are the types of loans that provide money the same day. These types of loans have high interest rates and fees. The Consumer Financial Protection Bureau (CFPB) has more information available on payday loans.
  • Never give your VA account information, Social Security number, or any other government benefits account information, such as your username and log-in information, during any loan application process.
  • Do not choose a lender that requires no documentation or background checks to provide you with a loan.