If you're a VA homeowner or home buyer here in Minnesota, Western Wisconsin, or anywhere across the U.S., please be careful — VA refinance scams are on the rise.

Some lenders are targeting our veterans with official-looking letters, calls, and emails promising lower interest rates, skipped payments, or easy savings. But the truth is, many of these offers are misleading at best — and flat-out scams at worst.

🎯 What’s Really Going On

Recently, I’ve seen more and more of my veteran clients receive mailers claiming things like:

“Lower your payment now!”
“No appraisal, no income verification, nothing out of pocket!”
“You may skip your next two mortgage payments!”

Sounds great, right? But here’s the problem — these third-party companies aren’t affiliated with the VA at all. They’re using the VA’s name and logo to appear legitimate, but their real goal is to churn loans and generate profit, not to help veterans.

💬 A Real Example from a Local Veteran

I recently reviewed one of these letters with my trusted lender, Peter Lindquist, and what we found was shocking.

The letter claimed a 4.75% interest rate and 5.39% APR on a refinance offer. That alone is confusing — but here’s what Peter discovered after running the numbers:

“It would take six and a half discount points to get that APR. That’s over $22,000 in fees added to the loan — and the VA only allows two points total. So this offer wasn’t even possible.”

That’s right — the VA wouldn’t approve a loan like this. But these companies send the letter anyway, hoping a veteran will call the number and give personal information over the phone.

🔍 The Red Flags to Watch For

Here’s what Peter and I found in this so-called VA Interest Rate Reduction Notice:

  • ❌ Fake “VA File Number” – The letter included a number with the last four digits of the homeowner’s Social Security Number to look official. That’s private, nonpublic information.

  • ❌ Impossible Loan Terms – “No appraisal, no income, no cash out of pocket” plus a below-market interest rate? That’s not how the VA refinance program works.

  • ❌ Hidden Costs – The fine print rolled thousands in fees into the new loan balance, stretching repayment over years and potentially resetting the loan term.

The VA has very strict rules to protect borrowers, but these scam letters break nearly all of them.

⚠️ The Bait and Switch

Here’s how it works:
A veteran receives the letter and calls the number. The lender then asks for personal details “to verify eligibility.” From there, they push the borrower toward a loan that’s completely different from what was advertised — with higher fees, extended terms, and no real savings.

It’s a bait-and-switch tactic, plain and simple.

💡 What You Can Do

If you’ve received one of these letters, do not call the number on the flyer.

Instead:

  1. Contact your current lender or loan servicer directly.

  2. Check your mortgage balance and rate through your VA-approved lender.

  3. Reach out to a trusted professional — someone local, who can review the letter and verify whether it’s legitimate.

Even today, with all the laws and regulations in place, predatory lenders still find ways to target veterans. It’s frustrating — and personal — because these are the same people who’ve served and sacrificed for our country.

🤝 Protect Yourself — and Others

If it sounds too good to be true, it probably is.

Here in Minnesota and Wisconsin, I’ve seen firsthand how confusing these refinance offers can be. Please — before signing anything, call a local expert who’s VA-certified and transparent about costs.

📞 Need Help?

If you have questions about:

  • Buying a home with a VA loan

  • Refinancing safely

  • Or verifying a lender or mail offer

Reach out to me directly. I’ll connect you with trusted local lenders like Peter Lindquist who can give you honest answers — no spam, no scams, no hidden costs.

 

Travis Andersen
Realtor | Minnesota & Western Wisconsin