There are several different places a person can apply for a secured or unsecured personal loan: a bank, finance company, or payday loan office. Each type of organization may require an application fee to initiate the lending process – it’s a common and allowable business practice.
An applicant knows when they visit a loan company’s office they’re doing business with an established company that actually provides the services they are paying a fee to possibly obtain.
Obtain a Personal Loan with Bad Credit
And that’s possibly why people with bad credit, who are familiar with some company’s business practices, fall victim to advance-fee loan scams.
Advance-fee loan scams involve various mechanics. They are all geared to get the applicant with bad credit to pay an advance loan fee by either: wiring money, paying by credit card, or sending money order, check or cash to complete their lending process.
The advance-fee scams mechanics typically involve first contacting people with bad credit by phone or via online solicitation. Second, qualifying then without obtaining their credit history; then finally, promising to complete the lending process by sending the loan principle after the advance-fee is received. It’s not uncommon for advance-fee scam artists to conducted their operations under a copycat name of reputable and well-known lending organizations. And loan applicant’s requesting a call back number to validate the lending company’s authenticity provides little or no protection from fraud.
Advance-fee loans offers could potentially involve fraud – borrowers beware.