Personal Loans

5 Personal Loan Scams You Should Avoid

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Not all of us has the luxury to approach a bank when we need immediate funds for a brief period. Some of us do not consider to apply for a loan with mainstream banks because of a poor credit score, and also it takes a lot of time to get the funds. Many lenders are now bringing their business online, and also they have simplified the process of applying for a loan. Online Unsecured Personal Loans have become very popular as they help us out when we need a small amount of fund for an emergency. However, always remember that not every option that you come across is healthy for your financial fitness.

In this article:

5 Signs of a Personal Loan Scam

The internet is full of articles that talks about the signs and warnings that you must look for while searching for a loan online. We’ve listed the top 5 tell-tale signs that will help you to recognise a scam as soon as you see one.

#1 No Credit Check Required
If a lender claims and assures you that they offer “No Credit Check Loans”, then it’s a spam. Every lender has to run a credit check to assess your affordability and creditworthiness by law. If you have a poor credit score, you might be tempted with such offers. But the truth is harsh – it’s a sign of a scam and you must not deal with such lenders or even credit introducers. When you face an emergency and your credit score is not perfect, you may want to accept such deals that might come your way. However, you must refrain from entering a trap to save yourself from financial stress.

#2 The Website is Not Secured
Visit the website of the lender to check whether their website is secured or not. If you notice that there is no “s” after “HTTP” on the website address – then you shouldn’t provide any confidential information on that website as it is not secured. In addition to that, check for a padlock symbol on pages where you are requested to provide your details for further processing of a loan. The scammers may swindle you to buck off money from you. Be aware when you are asked to fill up any form online.

#3 You’re Asked to Make a Quick Decision
Scammers will offer you lucrative deals that you may find hard to ignore, and they will ask you to make a quick decision. They may say that as their offer is expiring soon, you must consider taking a loan from them now or else you may not get the deal that is cheap and affordable now. Remember that reputed and genuine lenders, credit brokers, and financial firms understand that the borrower may need time to understand everything about the product they are choosing to go ahead with. Therefore, they do not rush you to make an instant decision.

#4 Lender Asks for Upfront Fee
Lenders and credit introducers who are registered by the Financial Conduct Authority will never ask you to pay any upfront fees to approve your loan. While scammers may ask you to pay an upfront fee, a loan origination fee, and other charges to approve your loan application. Reputed lenders do not need to ask you for money to process the application. If a lender asks you to make a payment before you receive your loan – walk straight away from the offer.

#5 Approval is Guaranteed
When you are searching for loans, you may come across advertisements that say “Guaranteed Approval” or “Everyone is accepted”. Every lender has to run a credit check to know your affordability, your past relationship with credit and payment before making their final decision. Hence, if you find such offers, it is better to stay away or else you may end up a debt scam. However, there are lenders who accept loan applications from individuals who have a bad credit score. They conduct credit checks on those profiles as well to make a decision.

What to do If You’ve Been Scammed?

If you are a victim of a loan scam, then you must report the issue to the Financial Conduct Authority immediately. Panic can make matters worse rather than helping you to recover from your financial loss.

If you have not shared your bank details, and no money has been deducted from your account yet

  • When you receive a phishing email, ensure to click on “report” and do not click any other links provided in the mail.
  • You can report it to Action Fraud UK by visiting at actionfraud.police.uk

If you have shared your bank details and money has been deducted from your bank account

  • Report it to the Action Fraud UK immediately as a crime.
  • Contact your bank and ask them to cancel the card immediately.

Where to Find the Best Personal Loans Online?

Look for all these possible signs of scams before making your decision. Check for online reviews of the lender, and check them up on the Financial Services Register. If a lender or credit broker is authorised by the FCA – then you may deal with them. There is absolutely no harm. Typically, lenders offer Unsecured Personal Loans up to £35,000. Go through the Terms & Conditions of the lender before signing on the dotted line. The loan amount that you can get from the lender depends on your credit history, length of the loan, your income, and expenses as well.

Oyster Loan is an FCA registered credit broker that operates across the United Kingdom. We have a panel of lenders who are also licensed by the financial regulator. All you have to do is fillup our online application form – which will take a couple of minutes, and submit it online for the lenders to review and verify the information provided by you. Within a few minutes, you will know the decision of the lender and you do not have to wait around for hours and even days to know their decision.

If the lender approves your loan application, you may receive the funds in your bank account on the same day within a few hours. However, the actual time that may be required for the fund disbursal depends on the lender and your bank. Still, it will not take much time for the disbursal.

To start your application, please Click Here.

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