If you’re applying for payday loans, you should be wary of potential scams. While there are many reputable resources for payday loans, not all of them are legitimate.
Before you apply for a payday loan, keep these tips in mind to help you avoid falling victim to a scam.
Payday Loan Scam #1: Fake Online Applications
Online payday loan websites aren’t always valid. Some websites create false application forms. When you visit the website, you will be prompted to enter personal information into a form under the guise of applying for a loan. However, there are alternative motives. The company will take the information you entered and try to sell your information to various vendors looking to get your business.
How to Avoid It:
Look for online reviews regarding the company. If there’s a phone number listed on the website, give them a call to request more information before you apply.
Payday Loan Scam #2: Collection Agency
Another scam that is common is when a debt collection agency calls you acting on behalf of the payday lender. The caller will tell you that you’ve failed to repay a payday loan. Often, these calls will become aggressive with threats of jail time and garnished wages.
How to Avoid It:
Google the company’s name. Do any company details show up? Can you find a phone number, website, or address? If not, the company is highly likely to be a scam.
If you have recently taken out a payday loan but aren’t sure the caller is from the same company, give your lender a call directly. You can also request the collection agency send you valid paperwork legitimizing the debt.
Payday Loan Scam #3: Outrageous Interest Fees and Repayment Timeline
When applying for a loan, be sure to pay extra attention to their interest rates and repayment timeline.
Some companies try to hide outrageous fees within their contract. Most people don’t realize that there’s a payday loan interest cap that varies state to state.
How to Avoid It:
Ask for the interest fees and repayment timeline information upfront. Be sure to double check the payday loan interest rate by each state.
Partner with a Payday Loan Lender You Can Trust
At Money N’ Minutes, we’re committed to being a reliable partner for all of our clients. For over 10 years we’ve helped our neighbors throughout the Kansas City metro with their payday loans. We’re transparent, honest, and dependable every step of the way. See our payday loan process for more information.
Give us a chance to earn your business. You won’t be disappointed.
