How to Protect Yourself from a Loan Scam

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We are always looking for alternative ways to raise extra money. And when times are too tough, we turn to the different kinds of loans. This is where we can be easily tricked. Some scams are obvious, and some are thinly veiled. Anyway, it is really sad when fraud is found and the problem is not resolved.

How to find out if the loan offices work according to the law? And how to be sure about the quality and safety of such services? If you are attentive, there are some ways to check if the transaction is a scam or not.

The best advice is to be mindful. Think if some offers are too good to be true, or vice-versa, conditions are absolutely abnormal. It is very important to spot the fraudulent scheme before providing your personal information.

Warning Signals

One of the first signs of scammers is the absence of their location and contact information. If there is no way to get in touch with the lenders, it is better not to accept or seek any help from them. In such a situation, do not try finding a way to contact a lender. Just make another choice.

The next most obvious “red flags” are spelling and grammar mistakes. It often happens because the cheaters come from other countries. Keep in mind that a reliable company will not allow such errors.

If you have never requested for the loans online, the email with the approval of one is probably a scam (at least, a mistake). Such notifications can provoke even identity theft. By the way, the statistics show the number of such incidents grew significantly from 807 to 3267 per year (from 2010 to 2017).

Do not react to an email other than the one in the header. Thus you may be involved in the fraud. According to the Canadian Bankers Association: “Very often fraud is committed by highly sophisticated organized crime networks. Criminals also try to gain access to personal information such as passwords, personal, banking and credit card details as well as social insurance numbers.”

Here are the proven ways to get approved for a personal loan avoiding scams.

Cut off the contacts with a lender, that demands money from you. In order to receive the loan, you should never pay any funds beforehand. If you are asked for a deposit, the lender wants to make a profit from your troubles.

Scrutinize the Situation

Some circumstances oblige us to act urgently. But even if you need money in the nearest future, dedicate time and think clearly. Make a little examination of the potential loan company. Try to find some information about it online, combine the name of the company with the word “scam”, read the feedback. Those people who have been already scammed could leave a complaint. These simple steps can help you to prevent becoming a victim.

If you have found no information about the particular lender, this is one more reason not to deal with it. Better Business Bureau can inform you about the company you are cooperating with. In case you know nothing about the reputation of the lender, you should not take a risk. Work with credible and registered companies to know that you and your personal data are secure.

Whois can determine when the website appeared and who its owner is. Usually, scammers do not use the same website for a long time. Beware of new companies.

A mapping application, for example, Google Maps, is a great tool to find a payday loan company. Look for the actual address of the company. It must seem legitimate from the street view level. Google can show you a flat or private house at the address. That means the company, apparently, does not exist. Keep away from it.

As an Outcome

The victims of scams are usually not very careful, that is why they are easy to get tricked. There is no free lunch in this world. And if the deal seems to be too approachable, it can turn to be a scam. Never give your information to those companies and lenders, which are not tested and trusted.

Scammers must be punished. When you become a victim of those, do not wait to call the local Better Business Bureau and the police department. Try not to become hooked. Do not rush to borrow money, especially when you do not need them immediately. Eventually, you will be obliged to pay off much more, than you expected. Seek different opportunities. It is better to be safe than sorry.

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