Be Aware Of Payday Loan Scams

For those people who find themselves in times of financial need, a payday loan may be the answer. Payday loans are short-term loans that can help people get through unexpected hardships that come up before payday. Unfortunately, with every legitimate business there comes scam artists who attempt to take advantage of innocent people. This is particularly true of services that deal directly with money, including money wiring businesses, lotteries, and loan companies. While there are an abundant of ways that thieves attempt to rip you off, you can avoid becoming another victim by being aware of potential scams by using a little common sense.

One way that hustlers attempt to con people out of money under the guise of a legitimate loan business is the collection scam. In this ruse, someone (or several people) call your house repeatedly claiming that you owe money for a loan that you may or may not have taken out. These callers are usually pretty aggressive, using strong language and even scare tactics such as threatening you with legal action, including fines and jail time.

In fact, according to the Internet Crime Complaint Center, there have been recent cases of fake collection agents showing up to people's home or place of work demanding payment for a supposedly defaulted loan. If this happens to you, you can respond in a number of ways. First, you can let the 'agent' know that you will be reporting the incident to the police, and should do so if they become particularly aggressive. Secondly, after being approached you should contact your bank, credit cards, and the three major credit bureaus in order to put your accounts on alert for possible fraudulent activity. Finally, if you have borrowed a loan recently, be sure to contact your loan provider in order to check on the status of your loan.

Another way that scammers use the payday loan business to bilk victims out of money is to call people and offer an unsolicited loan. In such cases, a person calls you to inform you that you have been pre-approved for a loan. The caller then asks for bank information in order to deposit the loan into your account. However, the victim never sees any money deposited into their account, and often have money withdrawn for a wire fees, service fees, etc.

This scam is on the rise and can be particularly confusing as often this happens during or after a victim is searching for a payday loan lender online. One way to avoid becoming a victim is to practice a little common sense. Never give your information to just anybody. If you are applying for a loan online, be sure to research the company first. Any valid company should have a history of customer reviews that can be found online.

Also, remember that no legitimate company will ever solicit banking information from you over the phone. This includes any type of business, not just a loan company. Likewise, be aware that no loan company will offer you an unsolicited loan, thus getting a call from a company offering you a loan that you did not ask for is a major red flag. Should you find yourself at the receiving end of such a phone call, simply hang up or let the caller know that you will be reporting him or her to the authorities for further investigation. By keeping this in mind, you can avoid becoming another scam victim.

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