Unfortunately, scams are on the rise, with thieves continually inventing new ways to commit fraud and take the hard-earned money of consumers. One such method is loan scams. If you are planning on applying for a loan in the near future, it’s imperative to understand what these scams are and how to recognize the signs to protect yourself from identity theft. The following blog covers what you should know about these matters, including the importance of working with a Michigan identity theft lawyer to explore your legal options.
What Are Loan Scams, and How Can They Compromise My Identity?
Loan scams occur anytime you are tricked into applying for a loan that will never be delivered. Most commonly, these companies target those in financial distress, as these borrowers may be less critical of companies in the hopes of approval, so they can make necessary payments.
Unfortunately, loan scams are often two-fold. The first way in which they can scam you is through upfront fees. In many instances, these fake lenders will ask for an application or approval fee to process your loan. While some legitimate lenders may require a small fee, they are often factored into your loan or your payments. As such, a lender can take your funds without ever delivering the loan you were promised.
The other way in which these scams can impact you is through identity theft. When you apply for a loan, you’ll need to provide a considerable amount of information. Generally, this includes personal information like your full name, address, date of birth, Social Security number, and even your banking information. The scammer can then use these details to apply for loans in your name, leaving you in considerable debt you may not even know exists.
What Are Signs a Lender Is Not Legitimate?
If you are applying for loans, it’s critical to take the necessary steps to ensure that the lender to whom you are submitting the application is legitimate. In many instances, one tell-tale sign that a lender may not be real is if they do not have a physical address associated with their business. If you cannot find a mailing address or building where the lender works from, there is a high chance that they are not a legitimate company.
Additionally, you’ll find that a lender who guarantees approval or tells you your credit score doesn’t matter for your application can be indicative that the lender is not legitimate. A legitimate lender will consider your credit score when making a decision and will not guarantee approval.
As you can see, there are several factors you should carefully consider before applying for loans to ensure you can protect yourself and your information. If you believe you are the victim of loan scams in Michigan, it’s in your best interest to contact the team at Lyngklip & Associates as soon as possible to explore your legal options. We understand how difficult these matters can be to navigate, which is why we can assist you in securing your identity and fighting for the best possible outcome for your circumstances. Contact us today to learn how we can fight for you.
