Tips on How to Spot Bad Credit Loans Scams
Currently one of the biggest scams in North America is the bad credit loans scam. It’s a particularly unpleasant phenomenon because the people behind these scams are taking advantage of those in need of help the most.What happens is, a legitimate appearing financial company offers people with bad credit a loan, often times these loans are “guaranteed” in spite of of the client’s credit history. In other words, even if they have a bad credit or no credit, they are supposedly guaranteed to get a loan. All they need to do is pay an upfront “security deposit” for the loan because of their bad credit history. Unfortunately, the loan never comes and the security deposit vanishes into thin air.
Unemployed consumers with bills to pay and no access to credit, seek in desperation alternative ways for credit. Many are relieved when they find “financial companies” who give them a loan with “bad credit history” or “no credit history” the relief quickly turns into anger when they realize they’ve been scammed and will not only not get the loan they were promised, but have also lost their “fee” or “security deposit”.
Sometimes it can be hard to detect these scammers, but here are some tips to help you distinguish between legitimate financial companies and frauds.
Tips To Detect Bad Credit Loans Fraud
- The company asks for a fee upfront. It is illegal to ask for upfront payment for a loan in Canada.
- Never give out your personal or financial information over the phone or the Internet unless you know the company. This information could also be used for Identity Theft.
- Legitimate lenders never “guarantee” or say that you will get a loan before you even apply.
- Search for the company online along with the word “scam”. You’d be surprised what you could find. If the company is local, try to visit their office.
- Call the company’s number to make sure you’re dealing with the company you think you are. Also, don’t forget to check with the Better Business Bureau to see the company’s record.
Bad Credit Debt
Bad credit debt can be defined as any form of debt with a high interest rate for things you don’t really need. One example would be to purchase a luxury car on a credit card that you can’t really afford.
The worst form of bad credit debt is credit card debt because of the excessively high interest rates. It’s easy to get sucked in by credit cards and it is by far the way most people acquire bad credit debt.
What’s the quickest way to recover from bad credit debt? Paying credit card debt down or paying it off completely. And the best way to pay credit card debt down is start with the card with the highest interest rate. Then, focus on the debt with the next highest rate until you’ve paid off all of the debt.
Are you a victim of a Bad Credit Bad Loans Scam?
- Call Project Phonebusters toll-free at 1-888-495-8501 in Canada.
- You can also call the Competition Bureau at 1-800-348-5358.
- Contact local Policy as well as Federal Policy (RCMP and FBI)