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So you are down on your luck and looking for the perfect loan. You need money and you need it fast. Bad credit rating, bad credit score and nowhere to turn. Or you just need a quick loan to cover the holiday purchases. A little bit to hold you over till your tax return comes in.
Beware!!
There are unscrupulous people out there just ready to pounce on your misfortune.
Not only will they steal your hard earned and hard to raise money. They will steal your most precious hopes and your dreams.
If you have given them any personal or private information they will harvest that for a later date. And of course you HAVE given them all the information they requested.
Someone that seems so trustworthy and caring of your situation needs it to get you to the application step.
So you give them your bank account numbers, your credit card numbers and your social security or if Canadian, your SIN number. More than 5 million people in North America alone have been victims of a loan broker scam this past year.
Once they tell you your loan is approved they request money as a security fee on your signature of monthly payments.
As soon as they receive the money, they are gone. And so you too have now become the newest victim of a loan broker scam.
There are many loan broker scams out there. Everything from 1 800 numbers, PO Boxes, to phony make ship offices (that are gone in a month), with no forwarding address.
The consumer that finds himself a victim of a loan broker scam usually puts himself/herself in a much bigger financial hole. They could spend months trying to get back on their feet. They could also have set themselves up for bigger worries down the line. Identity fraud is usually the next step in these cases. They now have all your personal information and this could haunt you forever.
Loans that require an advance fee are just another loan broker scam that is looking for new victims.
They appeal to the unemployed, the down and out, those with bad credit and those in need of quick cash.
Once you read that a loan will be quarantined regardless of your credit history, you should see red flags.
How do you know you are dealing with a loan broker scam company?
Fortunately, there are many things to look for.
1. They want your money and personal information before they give you your loan application.
2. They press you to act quickly, most times to do it on the spot.
3. They need you to do everything right away so the loan can be processed quicker.
4. They won't let you know where their office is situated at.
5. They are not affiliated with any credited financial institutions.
A few things to do to protect yourself;
1. Make sure you do not give any personal information till you check them out.
2. Make sure they have an address, (a physical) location you can visit.
3. Make sure they have a secure web address.
4. If they ask for money upfront, do not give it to them.
5. It is against the law to request money of any kind until your loan is approved.
Always keep in mind that you need to check out the details of the companies you are dealing with.
There are many financial institutions and online sites that are legitimate and are willing to help you.
Don't sign anything or give away any personal information till you know who to trust.
Basically, a UK loan broker is there to help a person who is looking for a loan obtain the cheapest and best deal available to them based upon the borrower's specific needs and the resulting solutions will be tailor made to suit the borrower's own individual circumstances.
In a way, there is some similarity with buying a new car. For example, if you found the car of your dreams in the showroom, you would probably shop around a few dealers first of all to ensure that you are paying the lowest price for your new car before making any commitment to purchase.
Likewise with loans, there are many variables on top of a lender's APR that need to be factored into the total overall cost when considering which loan product to sign up to.
The trouble is, that whilst there are many comparison sites of different financial products on the web these days, most of them do little more than offer you side by side comparisons based on the lenders' typical APR. And firstly, ‘typical' means that not all applicants will be eligible for that rate. In fact, around a third won't be and, secondly, there may be other additional charges and fees that may not have been built into the quotes given on a comparison website.
A loan broker is designed to take out all of the guesswork for you. Not only that, they will save you valuable time and could even save you considerable money.
They would usually ask you how much you want to borrow, over what term and if you have any additional requirements which you'd like added to your loan package. Armed with that information, they will then search from their vast panel of lenders to find you the right deal specifically tailored to suit your needs. They're independent so they're not going to steer you towards any particular company as they work with many, often several hundred. Also, some of these are not available to customers direct and, such is the good standing of the relationship between the lender and the broker, the latter can often source you even better deals.
Because this all takes the labour of searching away from you, many cynics might be thinking how much this all costs. Well, the fact is that a reputable broker won't charge you a penny for their time. They simply make their income by obtaining a commission from any lender whose products they've recommended which have resulted in a loan ‘sale'. Therefore, it's always in the broker's own interest to find you the best deal to suit your own interests.