Many have fallen victims of payday loan scams due to ignorance. Payday loans companies provide people with cash in financial emergencies; that’s in moment of temporal financial difficulties. People who opt for payday loans are most times desperate; they are in need of fast cash that they forget to look out for signs that shows if these lenders are genuine or not. There are many fraudulent entities posing to be online payday lenders. It is expedient to be watchful in order not to be a victim of payday loan scam.
Here are five things to look out for when choosing a payday loan lender
Check for license
A legitimate payday loans online company is one that is certified by FCA. Here in the United Kingdom, the Federal Certificate Authority sees to it that payday lenders abide by the rules and regulation governing payday lending. They also offer protection to consumer, prohibiting these lenders from taking advantage of these consumers. License should be the first thing you look out for when choosing a payday lender because, if you have problem with your lender, you can always count on FCA’s protection. Dealing with an unlicensed lender too much of a risk you should probably avoid.
Look out for hidden charges
Never be too desperate to not peruse the terms and agreement before putting down your signature. Make sure whatever you are agreeing to was properly understood by you. When you carefully and thoroughly go through the terms, you might discover hidden fees which the lender never wanted you to discover. Ask questions regarding every fee if you don’t understand before sealing any deal.
Don’t send any advance payment
No legitimate payday lender would ask you to make any payment—be it small or huge amount before your loan can be approved. In case you see such, it is definitely not genuine. Payday loan scammers are likely to cook up any story in order just to get money off your pocket. You might be told that the money covers your tax or application charges, but note that a legit lender collects all their fees when your payment is due.
Make sure you can contact them
Beware of any payday loan company whose only contact is an email or a website. It is advisable to choose a payday loan lender whose loan officer you are in contact with—physically and on phone. A genuine payday lender isn’t only present online, but has a physical establishment. Having a physical location shows that you are dealing with a UK based company that is subject to FCA rules and regulations.
See how they are rated on TSO
Trading Standard Office though not enough measure to ascertain if a company is genuine or not, it does help. Through this bureau you can check how their consumer rating. How well have been spoken of the company by borrowers, what did consumers complain about, past violations and how these complaints were resolved. If you can’t find the company on TSO, it might be that the company isn’t registered in the UK, or no complaints have been filed by consumers.