Anyone who wants to get a personal loan to buy a new car or something else should be aware of certain scams that exist. Becoming a victim of a loan scam could destroy your finances, which is why it’s crucial that you get as much information as possible. In this article you will learn about some of the more common personal loan scams that exist. Learning about these scams will help you protect yourself effectively.
- The Lender Doesn’t Require a Credit Check
If you ever encounter a lender that says they don’t run credit checks on applicants, it’s a good idea to avoid them altogether. The fact is that any reputable lender will always run credit checks on those who apply for loans. Some loans are easier to get than others with bad credit, but a vast majority of lenders will at least check out your score.
- There is no Physical Address
Another sign that someone might be trying to scam you out of your money or information is if they have a lending “business” with no physical address. Even lenders that do business online give a physical address of some kind. Take the time to see if you can find an address for the lender you are thinking about applying for a loan with. Scammers never provide a physical address, because it makes suing them virtually impossible when you realize you have been ripped off.
- They have a Limited Time Offer
Lenders that tell you they have a “limited time offer” for the type of loan you need probably aren’t legitimate. This is simply not the way that lenders operate, so you should keep this in mind. Disreputable lenders use this tactic to pressure people into taking loan deals that are usually not even that good. You should never make a decision like this because you feel pressured.
- You Need to Pay Your Fees Upfront
You should avoid any lender that asks you to pay fees upfront. These people usually just want to get your money without giving you a loan in return. No reputable lender will ever ask for fees until the end of the loan period. This is one of the more common loan scams that you should be aware of when looking to borrow money.
- Approval is Guaranteed
Never borrow from a lender that will absolutely guarantees your approval. There are a lot of lenders who will say this, but it is simply not true. You should never just assume that you are going to get approved, regardless of how good your credit is. Any lender that tells you something like this is lying.
- Lack of Information on their Site
If you can’t seem to find a lot of information about a lender on their website, they may not be legitimate. Most reputable lenders will provide you with details about their credentials and other things. It is important that you take the time to get these details before deciding who to borrow from. You should check to make sure that a lender is not simply lying about their credentials, as this has been known to happen. The more information you get from the lender, the easier it will be to make the right decision.
- Untraditional Payments
If the lender asks for gift cards as payment, it is almost certain that they are shady and not legitimate. Any legitimate lender will only accept payment with cash, a credit card or cheque. A lot of scammers only want gift cards because they cannot be traced. You should also avoid lenders that require borrowers to use a pre-paid debit card to submit their payment.
- Unsecured Website
If you notice that a certain lender’s website is not secure, you should run fast and far. All reputable lenders have secure sites that use modern encryption to protect the information of those who apply for loans. Applying through an unsecured website could result in having your identity stolen. You want to know that the site you are using to fill out your loan application is completely secure. Always look for the “https” before you decide to submit an application for a loan you want.
All of these things are clear signs of a personal loan scam, and you should keep them in mind when you are trying to get your loan. While it is true that most lenders are perfectly reputable and trustworthy, there are still quite a few scammers out there. Those who have this information will be able to guard themselves against devious personal loan scams that can be very damaging. If you don’t want to have your identity stolen, you must keep all of these signs in mind. In the end you will be glad you decided to educate yourself.