When looking for a loan, it may be tempting to use an online lender. However, with so many available options, it can be challenging to tell which choices are trustworthy and which aren't. If you want to avoid scams when applying for a personal loan, read on for some tips on how best to spot them.
If you’re looking to borrow money online, it’s important to know how to spot legitimate online lenders. Here are some things you can check:
Contact information. The lending site's website is a good way to check the contact information. Some of the most common red flags are an address that doesn't match what’s shown on google maps or an email address that isn’t a real person’s name or alias, like “info@.” If something seems wrong with their contact information, move on and try another lender.
Privacy policy and terms & conditions pages. These pages should provide you with an idea of what kind of information they collect about their clients and how they use this data for marketing purposes. Make sure that these policies don’t contradict each other.
When you have found a lender, you must ensure they are legitimate. A legitimate online lender will be able to provide you with the following:
An online presence (website, Facebook page, etc.)
A physical address of their business location.
A phone number you can call during normal business hours.
Customer service support during normal business hours.
Some of this information might not seem like much, but remember that scammers don't go to this extra effort because it costs money. By verifying these details about your potential lender before proceeding with your application process and money transfers, you’ll know that your transaction is safe and secure.
Another important sign of legitimate online lenders is that the website should be well designed and easy to navigate. Things like load times, page organization, and clear contact information are all things you should pay attention to when evaluating potential lenders.
This could be bad if you can’t find any information about your loan on the site. Your lender must earn your trust before receiving sensitive financial information like a bank account number.
As you go about research, look for some of these things:
Reviews from real customers. The best online lenders have few reviews from real customers, not just glowing endorsements from their employees.
Variety of sources. If all the reviews come from one location and period, that’s a bad sign. You want to see some variety in where and when people leave feedback about the lender.
Variety of situations. You should also look at what types of situations individual customers found themselves in when they used this lender—and whether they were happy with how it handled their cases.
Look for a licensed lender in your area and verify that website is online. If you can’t find any information about it on the internet, it’s probably not legitimate. Compare offers from different lenders.
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