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Many people turn to the internet to find quick and easy loan options. Doing an online search for the word “loan” yields thousands of results. But how do you know which websites are offering legitimate loan offers, and which websites are operated by con artists trying to steal your personal information and gain access to your money? Below you will find helpful information about how loan scams work, how to spot a fake loan offer, and what scammers are doing with your information once they have it.
What Are Online Loan Scams?
Online loan scams are orchestrated by fraudsters posing as legitimate lenders and government agencies, or by fraudsters impersonating financial institutions to trick people into sharing their personal and financial information. Scammers may also request that fees be paid up front for loans that don’t truly exist. These “loan offers” are found on fake websites that mimic real lenders, on social media ads promoting “guaranteed approval,” or you may even receive unsolicited emails, text messages, or phone calls claiming you have been pre-approved for a loan you have never applied for.
How to Spot a Fake Loan Offer
Common red flags of online loan scams include:
- Guaranteed Approval: Reputable lenders will perform a credit check. If a lender offers you a loan regardless of your credit history, it’s a red flag.
- Upfront fees: Scammers may request a processing fee or first payment before the loan is even disbursed. Legitimate lenders typically don’t ask for a payment before the loan is granted.
- Pressure to act quickly: Fraudsters use high pressure tactics to claim a loan offer is for a “limited time only” to try to get you to act fast. Pause and think before divulging any of your personal information.
- They request your online banking credentials: Under no circumstance should you ever share your username or password to allow a third party to access your online banking. Nobody needs this information to send money to you or receive money from you.
- The Lender’s website has errors: If there are misspelled words, typos, and broken links on the lender’s webpage, these are all warnings that the website and lender are not legitimate.
- Unsolicited Contact: Be suspicious of any unexpected message you receive offering a loan, especially if you did not initiate contact.
- Unclear Terms or Details: Watch out for lenders who are vague about their interest rates, fees, or terms and conditions.
The Impact of Loan Scams
Falling victim to a loan scam can lead to monetary losses, damage to your credit score, and identity theft. Even if you never send money directly to a fraudster for a “loan fee,” the domino effect of sharing your personal and financial information as part of a loan scam can create serious consequences that can be burdensome to recover from.
At First Citizens Bank, your financial wellbeing is our top priority. If you suspect that you have fallen victim to a scam, need help identifying a potential scam, or need to apply for a loan please reach out to First Citizens Bank directly by calling 800-423-1602. Our fraud team and lending department are always here to help.