PERSONAL LOAN SCAMS
While in the market for a loan, there are several
loan scams to be aware of. The majority of scams occur when a
supposed lender requests a fee in advance in order for you to
receive your total financing. After you remit this requested advance
fee, the lender vanishes and you never receive your loan. Learn more
about advance fee
During times of desperation, it is very easy to
become preoccupied from apparent signals of a scam. A rule of thumb
to follow: If it is too good to be true, it is. Below are some of
the common signs to look for to help avoid from falling victim to
any type of scam.
'We are going to need a deposit.'
It is common for some actual loans from real lenders to require a
deposit. This is why the deposit/advance fee requirement is the most
common type of loan scam. If any lender asks for a deposit, make
sure you not only ask questions like 'why?', 'when will I get my
money', but also make sure this potential lender is legitimate by
doing research online and checking with the BBB.
'Because of your bad credit history, we are going to need a
Individuals with bad credit are frequently easy targets as a result
of despair. In the event that you are unable to obtain a loan via
traditional means (your bank, credit union, etc.) you may be
effortlessly persuaded to pay extra for a loan. When you have bad
credit, genuine lenders will impose higher interest rates. But they
will not ask you for any sort of pre-payments. As mentioned above,
they may ask for a deposit...which is different from a pre-pay.
'There is a fee you have to pay to apply.'
It is very likely that you will be required to pay an application
fee even when applying with a legitimate lender. However, you will
not be asked to pay this fee out of your pocket. Instead, legitimate
lenders roll any sort of application fees into the total loan cost.
'Collateral is required.'
This angle of scamming is not limited to only people with bad
credit. Cons may say that in order for you to get your cash, they
need money from you as collateral. Any legitimate lender requesting
collateral is not going to be asking for cash. Instead, they want
you to put some sort of personal property up for securing your loan.
How to Avoid Loan Scams
Being on the lookout for the above scams will definitely help
you avoid from becoming a victim. Below are a few more tips that
will help you.
- Be on the lookout for companies utilizing names that are very
similar to actual bank and lenders. If you have any concerns about
the legitimacy of a potential lender, do some research before
committing to use them as your source of financing.
- Any company offering an approval over the phone is illegitimate.
It is illegal for any US company to grant loan approvals over the
- Never wire any money (cashier's check or MoneyGram). You will be
out of any money that you wire to any loan company, especially
because this type of money is untraceable.
- Never accept a loan that does not require any type of credit
approval as a part of their process. Every loan is going to
necessitate either a soft or hard pull of your credit.
Being a Wise Borrower
Bad Credit Loan Information
Advice for First Time Borrowers
the Best Rates
a Loan Makes Sense
Advantages of Personal Loans
Are Unsecured Loans for Consolidating Debt a Good Idea?
Dangers of Debt Consolidation Loans
Credit Unsecured Personal Loans for Getting Rid of Bad
Loan Aspects to Avoid
What Happens If I Default
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