Scams When Taking Out Payday Loans

Nowadays, many banking operations are done through the Internet. With the help of the online technologies people are able to transfer money online, receive payments and even take out loans. This has tremendously changed the way we live and make our economic decisions. Payday loans have long ago become a lifeline for people all over the world not only in the US. However safe this sphere may seem to be, there are also scammers involved.

To begin with, let us discuss in more details what a payday loan is. This type of loans is usually available through online lending services in the amounts of up to $500 and for a rather restricted period of time, usually not more than 30 days or a calendar month. Moreover, these loans come with high interest of approximately $15 for each $100 taken out.

Online Scam Schemes In Payday Loan Industry

To help you take out money safely, we have prepared a list of some of the most popular schemes used in the US. By means of these you may lose lots of money therefore you should watch out for any alike features in your short-term loan agreements or negotiations.

This is how scammers try to fool you in terms of applying for the payday advance:

  • asking you to pay a fee or charge first: this is a first sign of dangerous intentions. Fee is usually paid once you repay the loan and not upfront. Moreover, if suggested means for this payment include a wire transfer, money order, or gift card, be sure to look for other online lenders;
  • claiming they are debt collectors: this is a typical scam in the financial world when the self-proclaimed debt collectors call in the middle of the night, calling you by a name and being fully aware of your personal details and ask you to repay the debt right now. If you do currently have a loan, call your lender directly to verify the terms of repayment;
  • asking you to fill in a suspicious form online: these suspicious forms usually do not end up with an extended payday loan. Instead you become enrolled into some kind of a membership programme by the scammers and this programme withdraws money directly from your bank account. Any time you want to fill in your bank details, make sure you know the party receiving those to be trustworthy.

To wrap things up, deceits are everywhere, especially in the online world. To avoid getting into such an unfortunate situation, you have to be critical when it comes to filling in online forms and talking to some collectors on the phone. Always remember, that decent partners will always be open to negotiation and eagerly provide you with any information you may want to receive unlike the scammers.

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