Lending Scams To Avoid At All Costs
If you read debt-free lifestyle blogs for inspiration on how to get out of debt, you run into a lot of advice about how you should never borrow money out of desperation. This kind of advice comes across a lot like when Baby Boomers give you financial advice with the assumption that everyone has employer-provided health insurance and an employer-provided retirement account. Why would anyone charge groceries on a credit card if they could afford to pay for them with money from their bank account? Unfortunately, the less money you have, the more it costs to borrow any amount. For millions of Americans, risky loans are their only option, at least in the short term, to avoid defaulting on existing debts. To find out more about long-term solutions, contact a Miami debt lawyer.
Signs of a Lending Scam
Even if personal finance experts and people who retired in comfort are not aware of how desperate many consumers are for loans that they can access quickly, scammers are well aware of this fact. Lending scams tend to prey on elderly people, as well as people in a vulnerable financial situation, such as those who owe a lot of money on student loans or car loans. These scams make it sound like you can easily access loan money with little or no credit check. After you pay a fee to borrow the money, the lender ghosts you. The biggest sign of a lending scam is that you have to pay a fee upfront; trustworthy lenders, no matter how predatory the conditions of the loan, have you pay the fees as part of your monthly payment or make you pay them after you have paid back the principal.
These are some other signs of lending scams:
- You find out about the loan offer through a telemarketing call.
- There is no credit check before the lender approves you; the lender only cares about getting you to pay an upfront fee.
- The lender wants you to send the fee by wire transfer.
- The lender wants you to use a prepaid gift card to pay the fee.
How to Avoid Getting Scammed
The best way to avoid a lending scam is to read the fine print on the loan agreement and to keep a copy of the agreement. Signing an agreement to borrow a loan with a 100 percent interest rate is better than not knowing the conditions of your loan. It may be that your only option to avoid getting evicted from your apartment this month is to take out an auto title loan, which will lead to your car being repossessed if you don’t pay it back next month. At least, though, you are buying time with which to meet with a debt lawyer about more comprehensive solutions like debt consolidation or filing for bankruptcy protection.
Contact a South Florida Debt Lawyer About Protecting Yourself From Lending Scams
A South Florida debt lawyer can help you find short-term and long-term solutions to your debt problems. Contact Nowack & Olson, PLLC in Miami, Florida to discuss your case.