Protect from Personal Loan Scam

Are you thinking of getting a personal loan? Hopefully you have a high credit score, as this will give you a better chance of getting the loan through a legitimate company. But even if your credit is excellent, you need to be aware of the personal loan scams out there.

Not Respecting Your Limit

• You don’t want to do business with a lender that pressures you into borrowing more than you can handle

Upfront Payment

• You should never have to pay any fees for the application process. If you’re requested to do this, move on.

Pumped up Interest Rate

• Know what the going interest rate is. A good lender will quote you near this average rate.
• A bad lender will recognize the desperation of the applicant with bad credit and try to sock them with an abnormally high interest rate.

Us and Only Us

• Be suspicious of lenders that don’t like the idea of you shopping around for better rates.
• This is a red flag that they have questionable loan practices.

Location, Location

• An honest, legitimate lender or bank has a verifiable physical address. Get this confirmed with Google maps.
• If you can’t, move on. But know that even a predatory lender may have a very solid physical address.

Solicitations

• As in ones you didn’t request. Watch out for banks that send you unsolicited invitations for a personal loan application.

Don’t Be Intimidated

• Because a seedy outfit may want to scare you into closing on their loan. But they can’t do anything to you, even if they use the term “legal action.”
• If you want to reject their loan offer, then do so.

SSN

• Does the lender want your Social Security number? This is fine if they’re wanting to do a credit check.
• If they’re not doing a credit check but want your SSN, move on.

Signing Empty Documents

• Do not sign anything that does not have the interest rate, terms, loan amount, monthly payment and other crucial information.
• Before signing anything, make sure there are no blank areas that can be filled in later.
• Run if the lender wants you to sign something that’s missing information.

Guaranteed!

• Is a bank guaranteeing your personal loan? Sounds great, right?
• Not so fast. They cannot do this if they have not verified your financial history or credit history.