Through my time working at Michigan First, I have learned a lot about the reality of scams and how they hurt and impact people’s lives. I am going to write one blog every week informing you about a type of scam to be aware of, in the hopes that you won’t become prey for the schemers of the world.
Advance Loan Scam
"This scam targets consumers who either get a call offering them a loan or who apply on-line for a loan at what appears to be a legitimate lender. In either case, there really is no lender but rather a scammer, who after accepting an advance fee of some sort, vanishes.” (From Michigan First Credit Union)
So, to break it down even further, this scam involves no personal contact, no office building, no licenses and usually no credit check. This is someone looking to get your money based on empty promises and your urgent need for a loan.
As I researched this scam further, I found a great article on fraud.org with warning signs that an advanced loan may be a scam. Here are some of the clues they share that should be a red light to you.
- If they ask for payment upfront. If a lender approves your loan, but demands a payment before you receive any money, it's most likely a scam.
- If they call you on the phone. It's against the law for a company to promise you a loan by phone and ask you to pay for it before money is delivered to you.
- If they say, credit doesn't matter. Yes, it does. Legit lenders use your credit score as a deciding factor for a loan.
I hope you took some time to read through these red light warnings so you won’t become a victim of fraud. As a rule of thumb, always check the Better Business Bureau before you sign a contract or pay a company based on what they tell you. Remember, if you have any questions, feel free to hit me up on social media, send me an email or call Michigan First 365 Live at 800.664.3828.
Keeping it Fresh, Young and Free,