Do you know how to avoid online loan scams?
The FTC is working hard to educate consumers about safe financial practices, and their latest initiative shows how many sites scam consumers who are trying to improve their credit scores. TO educate consumers, the FTC created a fake website, shown below:
Esteemed Lending Services - not a real company!
When you click on any link on the site, you will automatically be redirected to a new version of the site which shows you how you could have been scammed by one of these online loan companies. See the result, below.
Don't Get Scammed! Esteemed Lending Services is a fake site created by the FTC
Avoid online lending scams
Follow these tips and you will dramatically increase your odds of avoiding these scams!
- Lenders are very interested in your credit score and credit history. Avoid lenders that claim “guaranteed” and “no hassle” loans.
- Be aware of all fees. If the fees are clear, don’t sign anything! Be sure you know exactly how much you are required to pay. That means reading the fine print.
- Examine licenses and registrations. Make sure your lender is allowed to practice in your state.
- Up front fees. Lenders charge fees in the form of interest – not for approvals. Avoid all lenders that require you to wire money with your application.
You also want to avoid giving lenders your bank account information or permission to withhold payments from your paycheck – in many cases you’ll find an empty account or no paycheck.
Check out the fake FTC site for more information.
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{ 7 comments… read them below or add one }
Thanks for the mention Ryan!
Thanks for serving in the USAF.
My advice would be to go to a local bank to get a loan. Or credit union. Getting one online is just too risky in my view. Local is best. Then you reduce the risk of getting scammed.
A local lender is usually the best option, or a peer to peer lending company, such as Lending Club or Prosper. The problem though, is that most of these sites prey on individuals with poor credit by making promises of “guaranteed approval,” “instant approval,” etc. Education is the key.
Very interesting and it is becoming more difficult to realize what is real and what is a scam. Something we need to read about more.
Agreed. It’s very easy to place a logo or badge on your site declaring your site is “secure” or part of a legitimate network. Always research the company before sending them money or personal information.
I just would not trust the ones that you have to pay money up front to see if you qualify
Thanks for the mention Ryan!