Home Student loan Loan Scams: 10 Crazy Ways To Spot Them

Loan Scams: 10 Crazy Ways To Spot Them

How To Spot Loan Scams And Fraudsters

by oteneweb
How to spot loan scams

How To Spot Loan Scams

When you are in deep need of money and your credit score is very bad then you become open to any loan offers on the table and this makes it easy for loan scammers to get hold of you.
The fact that you are already in need of money and someone else wants to prey on your vulnerability seems sad but that is entirely true.
There are very creative scam artists that are waiting to take advantage of your situation. They come in different forms.
They offer very convincing loan options on websites or social media platforms but this is just to attract you so that they can collect your money.
These fraudsters are very polite and they make you feel very comfortable when you talk to them.
If you are not smart you will never perceive their intentions until they have already scammed you of the little money you have left.
In this article I will expose some things you should watch out for that could potentially save you from loan fraud.

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How To Spot Loan Scams And Loan Frauds

Each day, there are hundreds of people that lose their money to loan scammers. What they take from you might be big or small but it is still your money and they have no right to do that.
So then you may ask yourself, how do I spot loan fraudsters? Well, that is why we put this article together to answer all your questions.

Here are some of the easiest ways to spot loan fraudsters

Copycat Name

The first thing you should look out for when you want to collect a loan is the name of the lender.
In a bid to look legitimate, loan fraudsters create very good business names or websites that look and sound very genuine but are truly fake.
Before you contact any company online, check with Better Business Bureau to authenticate the address and phone number.
If their mailing address appears as a Post Office Box then be very cautious when you’re dealing with them.

Phone Offers

No legitimate loan company will make loan offers over the phone, it is illegal to do so.
If the company is online then there is a due process and if they’re not online then any offer must be put in writing.
Whether online or offline, all associated fees must be clearly mentioned in their offers.

Upfront Fees

Loan scammers may tell you to provide a little fee to process your loan application or document fees but these are all lies.
Take a good look at this; you are here for a loan but they are asking you to send money first before getting the loan, that’s a total scam.
Legitimate lenders will never ask for any upfront fees. Normally, all fees are added to the loan and they’re not asked in advance.

No Show of Interest in Your Credit History
Loan fraudsters will not show any interest in your credit history. They don’t even ask you or evaluate it.
Every legitimate lender will evaluate your creditworthiness before they determine how much they can give you.
If you ever hear claims like No Credit? Bad Credit? No Problem! Be careful else you’d fall for their scams. Your creditworthiness is always a problem.
A legitimate loan company is linked to the credit bureau so they always evaluate your creditworthiness before giving you a loan. This is just to make sure you’ll repay the loan.

Personal Information

Before you give out very sensitive information like your bank verification number, social security number, bank account number, date of birth, or any other information about yourself, make sure you’re certain that you are dealing with a legitimate lending institution.
If a loan scammer gets such information from you, they can steal your identity or wipe out funds from your bank.
There are even some legitimate lending platforms out there that offer loans without asking for all this information. If you have any doubts then do not give them such information

Wire Transfers

Never agree to wire money for any fees if they demand you to do so. If the account they send to you belongs to an individual and not a company then this is a huge warning to keep off.
Always ask for their physical address then reach out to the Financial Regulations or Attorney General’s office in the state to verify if they are a legal business or a scam.
If the lender is online then look for credible review sites and check the reviews they have. Even if you do all this, it is abnormal for a legitimate lender to ask for any upfront fees so take note.

Online Reviews

Online reviews are now becoming more important to businesses each day. Credible review sites can help you select a good loan agency.

All you need to do is to use Google to search for the lender’s name. You can also check Facebook, The Better Business Bureau, or other legitimate sites that give lending reviews.

If you see bad reviews then stay clear, do not try your luck. If this result is the same for multiple sites then this is clear proof it is a bad choice for you.
This is a good way to learn from other people’s experiences.

State Registration

Legitimate lending platforms register their businesses in the states where they operate.
To verify it they are legitimate then you can check through the Attorney General’s office, Department of Banking or Financial Regulations in your state.
This will not guarantee that your personal experience with that lender will be good but at least it can prevent you from falling into loan fraud.

Customer Service

Good lending platforms have phone numbers that you can call to complain if you are not comfortable with their services.
Don’t ever settle for a chat robot or phone robot. You should be able to chat or speak to a human being when you need to make inquiries.
When you talk to them, take note of anything they say that is off and ask questions that you know only legitimate lenders can answer.

Red Flags

There are many things that should prompt immediate concerns. Take note if their email messages contain errors in spelling, capitalization, grammar, or punctuation.
This shows that there is a lack of professionalism. Also, take note if they offer something like a year with no payments before loans must be repaid.
Definitely beware if the loan platform says they don’t do any credit checks and will lend you money regardless of any past financial problems.


There are hundreds of people falling victim to loan scams daily. Always watch out for everything mentioned above when you approach any loan agency.
If you have fallen to these scammers before, report them to relevant authorities and review them on credible review sites so that you can help stop them.

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