4. The lender calls, writes or knocks

4. The lender calls, writes or knocks

Takeaway: Never use untraceable payment methods, like a gift card, prepaid debit card, or cryptocurrency when dealing with a lender. You should accept a wire transfer, direct deposit, or a check you can deposit into your checking account.

If you get a loan offer by phone, through the mail or even through a door-to-door solicitation, be on your guard. According to the FTC, it’s illegal for companies to offer a loan in the U.S. over the phone and ask you to pay before they deliver.

Takeaway: A reputable lender will not target you over the phone, through direct mail or through door-to-door solicitation. Look for lenders that advertise through traditional online and mass media.

5. The lender has no physical address

Every lender you’re interested in should provide a physical location. Run it through Google Maps just in case. Some businesses running personal loan scams will list addresses that are actually vacant lots, so it’s important to verify this.

If you don’t find any sign of a physical address, avoid the lender. Many fraudulent businesses are untraceable so they can avoid legal consequences.

Takeaway: Don’t do business with a company that cannot provide a physical address, and always verify that the address is legitimate before you proceed.

6. The lender pressures you to act immediately

Don’t fall for the urgency plea. One of the halls is giving you an immediate deadline to sign on for a loan because the offer expires quickly – like within a day.

Lenders that use such high-pressure tactics could be up to no good. It may be a ploy to get you to make a rash decision.

Takeaway: Avoid offers with immediate deadlines for you to make a choice. You should have days and possibly weeks to accept a loan offer.

7. The lender is not transparent about its fees

Scammers will avoid posting their fees prominently on their websites or disclosing them when asked.

How much would you like to borrow?

How much would you like to borrow?

Representative Example: Rates from 49.9% APR to max 1333% APR. Minimum Loan Length is 1 month. Maximum Loan Length is 36 months. Representative Example: ?250 borrowed for 30 days. Total amount repayable is ?. Interest charged is ?, annual interest rate of 292% (fixed). Representative % APR (variable).

What are direct payday loans?

If you’ve ever had an emergency bill to pay, and you know that the savings you have left in your bank account simply aren’t going to cover it, then you’ll be well aware of the value that payday loans can offer.