Beware of These Scams When Applying for an Online Loan
You need to borrow money and you’re kind of in a rush because you’re dealing with an emergency. Maybe your car broke down or your utility bill increased significantly. Whatever the problem is, the only thing that will resolve the matter is cash. Whether you didn’t factor the expense into your budget or payday is more than a few days away there is a solution. There are online lenders willing to provide short-term loans for individuals in a jam.
Though each company’s requirements will vary, in a nutshell, you receive a payroll advance loan within one business day. Generally, you need to be 18 years of age, have verifiable income, and a checking account in good standing. Once all of this information has been confirmed, you’ll receive a cash deposit and be provided with options for repaying the loan in small bi-weekly or monthly payments.
So What’s the Catch?
If short-term online loans are so beneficial and easy to qualify for, what is there to be worried about? The truth is, there are a lot of con artists out there looking to take advantage of individuals in a difficult time. They will try and get as much personal information and money from you that you’ll end up worse than when you tried to apply.
How can you tell which lenders are legit and which are scams? Pay attention to these red flags:
- The website isn’t secure – You will be entering a ton of personal information and you want to make sure it is not stolen. If you go to apply for a loan and notice that it isn’t secure, back out immediately.
- They want cash upfront – No legitimate lender is going to ask you to pay for a short-term loan. If you applied for a loan and they ask for a deposit or fee upfront, do not provide them with any information or make any payments. Chances are you’ll never receive your deposit.
- No address or contact info – A reputable vendor isn’t trying to hide anything. They will always make sure their customers can reach them. On the site, you should be able to easily identify a number, physical address, and email address. If not, this could be a sign the lender is going to steal your information and disappear into the night.
- They rush you to act – If you’ve applied for a loan online just a few hours ago and constantly get calls and emails to act this could be a sign of a scam. Con artists are going to do whatever they can to try and get your money quickly, even if that means telling you the offer will expire in a few hours.
- It sounds too good to be true – Another dead giveaway that you’re dealing with a scammer is if the offer sounds too good to be true. Yes, there are great offers out there from short-term lenders, however, red flags should go off if you get offered a seriously high amount (short-term loans are generally a few hundred dollars) or if you get offers for no payments for a year (although flexible, payments are generally expected within a 14-30 day period).
Short-term online loans can be a lifesaver when you’re dealing with a financial emergency. It could be just the right amount of money to tide you over until payday. While you may be anxious to get approved for a loan, be mindful of the common scams being played out there. Instead, take your time in looking for a reputable lender who is registered in your state, has an outstanding rapport, and offers reasonable options to suit your budget and needs.