It is a tough world we are living in and many families, as well as businesses, are seeking ways to survive their financial difficulties. Unfortunately, situations like this leave people desperate and vulnerable to scammers who often bury their victims in thousands of dollars’ worth of debts.
Some loan scams can be easily identified. However, scammers are also elevating their game and are getting more difficult to spot. But, don’t fret. There are still a few great ways to avoid these predators and prevent yourself from being scammed. Here are some red flags that you should watch out for when making loan transactions.
Loan Scams Identifier
- Be vigilant of emails, calls, or text messages saying you have been pre-approved for a loan that you never applied for or requested. These unsolicited messages often lead to scam transactions and identity theft.
- Beware of lenders that do not have physical addresses or are refusing to disclose their contact details.
- Avoid lenders that only require your bank account information when doing their credit checks. Legitimate lenders always refer to a loan applicant’s credit report and ask for basic information.
- Wrong spelling and bad grammar are also indicators of loan scams.
- Most provinces in Canada deemed it illegal for loan companies to request an upfront fee before you can obtain your loan. Make sure that you are aware of your province’s laws on loan applications.
- If a lender requested that you make loan payments via money transfer or prepaid credit cards, cease all contact at once.
- Always make sure that the emails you receive about loan applications are from legitimate lenders by double checking the sender’s email address. Legal lending firms use business emails when communicating with loan applicants.
It always pays off to be vigilant especially if it involves money. Doing so can save you from scammers and getting yourself buried in unwanted debts.