It seems in every industry there is some type of scam. The loan industry has not been lucky enough to dodge scams. You have to be smart so that you do not fall prey to a scam lender.

Scam, then Scram

Scam lenders like to prey on those with the greatest need. If you are someone who is not likely to be approved for a loan then you appear to be an easy target. Scam artists prey on people with bad credit and who are low income.

What these scammers do is promise a large loan, but they want a fee paid up front. They say this is to secure the loan. They try to talk up the fact that it is something all lenders do.

This is not true.

Lenders may charge fees for application filing and such but you always know where the money is going and it is never paid to get you the loan. In the case of the scams if you do not pay then you do not get the loan.

You should just play it smart and always stick with lenders you know and can trust. Always research a lender you find online or in classifieds to be sure they are an accredited financial institution.