Considering an Online Loan? Watch Out for Advance-Fee Loan Scams
Do you need to borrow money for car repairs, medical expenses, or to consolidate credit card debt? Online loans may seem like a convenient option, but it’s important to be cautious. Some offers are not what they appear and could end up costing you more in the long run.
One of the most common tactics used in loan scams is known as an advance-fee loan scam. In this type of fraud, someone promises you a loan, credit card, or access to credit and asks you to pay a fee up front before any money is delivered. They may say they can guarantee your approval, even if your credit isn’t great, or that they work with a lender who can get you what you need.
Before moving forward with any loan offer, it’s a good idea to check for the following:
What to Know
- Legitimate lenders will not promise you a loan or credit without first reviewing your credit history.
- Real lenders may charge an application or appraisal fee, but this typically comes after your loan has been reviewed and is never a condition for guaranteed approval.
- No legitimate lender will require you to pay money up front in exchange for the promise of a loan.
Warning Signs of a Potential Scam
- The lender advertises that you can get approved regardless of your credit history.
- Fees are not clearly disclosed until after you’ve started the application process.
- You receive a call, message, or email offering a loan that you never applied for.
How to Protect Yourself
- Research any lender you’re considering. Check for reviews, a physical address, and contact information.
- Avoid offers that guarantee approval or push you to act quickly.
- Never send money or provide gift card numbers as part of a loan application. A real lender will not ask for these.
- If something feels off, take a step back and verify before you trust.
There are many reputable lenders out there, and with the right information, you can make an informed decision. If you’re ever unsure about a loan offer or feel pressured, it’s okay to pause and look into it further.