subject: Personal Loan Scams [print this page] Getting a personal loan can be a great way of generating revenue you may need for various financial requirements. These types of loans are fairly easy to acquire and can be obtained from by banks, private loan companies, private investors, and online lenders. Whilst looking for a personal loan it is vital that you are aware of scams and how to avoid them. The particular type of scam we are focusing on was ranked #5 in the United States for the year 2000. On average, each person who fell victim to this one scam lost, on average, $464. As a result of this, the Federal government has been working hard to inform and educate the public about such scams.
The advanced fee personal loan scam is the most common method of taking your money and running. Most victims of such a scam never report it to the authorities because they are embarrassed that they fell for such a hoax. Victims also feel angry and bitter, some don't even realize that they have been conned out of their own money that they couldn't afford to lose. One really shouldn't feel embarressed by this scam, it is an easy trap to fall for. When looking for a personal loan, a person is usually hunting money in desperation and so don't think twice about accepting to pay a fee for the money they hope they will be loaned in return. But instead they now have less money than they did in the first instance. Those who do report the scam are usually left feeling frustrated as the perpetrators of this awful scam are very rarely caught and brought to justice. It is very important that you do report any incidence of advanced fee personal loan scam. If you dont, you are only allowing the scam artists to continue their con and thus allowing them to take money off of other helpless victims.
Advanced fee personal loan scams prey on individuals who are desperate for a loan, over trusting, uneducated, and who have bad credit. More than half of advanced fee personal loan victims are under the age of 30. The lender tells the applicant that they guarantee that they can sort out a loan for any situation, bad credit etc, but in order to do this there is a loan processing fee involved before you can go any further. This fee can be anything up to a hundred dollars or sometimes even more than that. Another barrier for you to face when trying to spot a scam from a genuine offer of credit is using the technology that is readily available nowadays. This technology makes it easy for such operators of these scams to have a website and even 800 numbers so you can call them and so they can look and sound more genuine. They will also send you an official looking letter or some type of correspondence and they will make it look so professional and genuine, you wouldn't give it a second thought that maybe they are not what or who they say they are.
The stories of those victimized by such advanced fee personal loan scams will break your heart. One woman had been laid off and was about to be evicted. She found another job and applied for a personal loan to get caught up on the rent. She paid the lender almost her entire first paycheck for so called processing fees on this loan they guaranteed she was eligible for. She was understandably upset when she was evicted as well as found out the lender had taken off with her hard earned money.
To protect yourself from falling victim to advanced personal fee loan scams, be careful who you attempt to borrow from. Make sure they are a reputable company. If they are an online business, check them with the Better Business Bureau. Make sure you enter there business name exactly as they list it. A well known practice of this scam is to use a name very similar to an actual reputable lending institution that applicants may be familiar with the name of.
For those of you with bad credit or no credit, dont believe something that sounds too good to be true, it likely is as the saying goes. You may have to pay a higher interest rate if you have bad credit or no credit, but you should never have to pay any fees up front to apply for a loan or to have it processed. Some personal loan scams will call the fees you pay the first month payment or a high risk deposit. Applicants need to be aware that no such things exist. As a matter of fact, any lender must allow you to have access to the funds for minimum of seven days before they can collect a first payment. You can check the legitimacy of any fees charged by a financial institution with the Federal Trade Commission. If you are facing financial difficulties, look for advice from a reputable non-profit credit counseling service rather than a lender.
