Beware of loan companies that will steal your money and personal information.
Beware of advertisements that promise loans to anyone, regardless of their credit history. These ads may sound legitimate, but are just a front to get consumers money and personal information.
These fraudulent companies may appear legitimate. They have fake addresses and websites. Their phone numbers are free and start with (800), (866) and (877) which are difficult to locate. Consumers are required to complete loan applications and sometimes may receive fraudulent loan approval documents. These companies then advise applicants to pay an application fee or other compensatory fee and send the money by wire transfer. The money is sent to an individual rather than a business. The applicant never receives the loan and the consumer rarely receives a refund for the money sent.
the Michigan State Attorney General’s Office suggests:
Don’t pay for the promise of a loan. While legitimate lenders may charge you a small amount to process your request and cover your credit check costs, the fees are usually taken from the amount borrowed. Legitimate credit offers do not require an upfront payment.
Ignore any website offer, newspaper ad, or caller that guarantees a loan in exchange for a down payment. Legitimate lenders never guarantee that you will receive a loan until you have applied or before you have checked your credit status or contacted your references, especially if you have bad credit or no credit history. Beware of anyone who tells you they can provide loan approval by reviewing information you give over the phone without a credit check or who says you qualify for a competitive loan rate regardless of your history. credit.
Thoroughly investigate loan offers from unknown companies. Ask for the physical location of the business. Check if the location actually exists by entering their address on the United States Post Office website. Check the number and physical location of the business in the phone book or with directory assistance, and call them to make sure you’re dealing with the business you think you are. Check the lender with the Better Business Bureau. The attorney general’s office may also have useful information.
Do not wire money or send money orders for a loan. You have little recourse if there is a problem with the wire transfer transaction. Legitimate lenders don’t require you to wire funds. Refuse to do business with nobody that encourages you to send money or take action at once.
Do not make a payment to an individual for a loan. No legitimate credit institution would make such a request.
Avoid early charge offers that promise a credit card with a pre-approved limit and low interest rates for a fee. To pay the fee, you will be asked to provide your bank details and authorize an electronic draft to pay the fee. In most cases, the credit card never materializes, and the consumer’s bank account is quickly emptied.
Michigan State University Extension Educators urge all consumers to take the necessary precautions when applying for a loan. Consumers need to be proactive in protecting their personal information and their finances.
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