How to Avoid Payday Loan Scams
Make sure you are transacting with a legitimate and reputable payday loan lender. There are many fly-by-night operations that are preying on unsuspecting and needy consumers.
It is quite unfortunate that a number of dishonest individuals have given lending firms a bad image. These people are disguised as lenders but actually victimize unsuspecting borrowers through payday loan scams. These unprincipled loan sharks usually charge excessive fees and interest rates. Worse, some of these persons even try to steal the money of the poor borrowers by getting their bank account details.
Choose the Right Lending Facility
There may be no distinct way of distinguishing between upright and wicked lenders unless you have an unfortunate experience in obtaining this type of loan in the past. This is the reason why consumers are encouraged to research on the credentials and history of online lenders. It allows you to determine the company that has built the proper reputation. You also have to know guidelines about interest rates that lenders should charge for payday loans online. Some state governments have enacted laws to regulate finance charges.
Study the consumer loan agreement as this will provide you all the information about the due date of your loan, interest rate, repayment conditions, processing fees and other charges. Federal Law dictates that all lending companies should print the Annual Percentage Loan in bold fonts in the loan contract. This will indicate the actual cost of your loan. Ask the loan facilitator all relevant questions. Do not complete your application process unless you have fully understood the details of this conformity. Settle your quick cash advance on time. This will help you avoid the possibility of being ripped off by a corrupt lending agency.
Common Loan Scams
This quick solution may seem to be the answer to your financial crisis. On the contrary, you may be putting yourself in a tight fix by gong for this loan. One of the most prevalent scams is when the loan agent tries to ask for money prior to releasing funds to your bank account. When you part with your hard-earned cash, you may not receive any loan at all. Another kind of scam is when the company insists on acquiring your bank account details. There are ways of having your savings withdrawn from this account through electronic means. You may not even know until you check the balance.
There is also the phone collection fraud wherein you receive a call from an alleged collection agency or the FBI threatening you of legal proceedings due to late payments for your emergency loans. These callers may have all the information about you to convince you that this is a legitimate action. You will be subjected to all forms of threats and abuses. These are meant to force you to settle with cash or give your credit card details. Do not believe these calls right away. Contact your local bank to protect your account. Inform the credit bureaus of this situation as well as law enforcement authorities and the FBI. Report such incidents to your State’s Department of Consumer Affairs. Likewise, submit a written complaint to the federal Consumer Affairs Department.
The bottom line is to avoid obtaining payday advance whenever possible. Be very discreet with your decision to settle for quick remedies lest this turn out to be a bigger problem in the future.