Consumers lost nearly $3.3 billion collectively to fraudulent practices in 2020, according to the Federal Trade Commission. Potential fraudsters pounce on those who are most in need or the most likely to accept a fake offer. If you’re not careful, you might find yourself on the receiving end of a personal loan scam where you could potentially lose money.
You can learn how to check if a loan company is legitimate and avoid being a victim of fraud. Here are common signs of a potential loan scam.
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7 ways to spot personal loan scams
While this isn’t a comprehensive list, some of the most common ways to spot a personal loan scam include the following:
- The lender isn’t interested in your credit history.
- The lender isn’t registered in your state.
- The lender demands a prepaid credit card.
- The lender calls, writes or knocks.
- The lender has no physical address.
- The lender pressures you to act immediately.
- The lender is not transparent about its fees.
1. The lender isn’t interested in your credit history
Truly reputable lenders make it clear that they’ll need to look at your credit, sometimes getting reports from all three major credit bureaus (Equifax, TransUnion and Experian). Most lenders need to know whether you have a history of paying bills on time and in full to make sure you’ll be diligent about…
