Loan Scam??

[+ Kman]

So, I've been shopping around for a loan and I don't have great credit right now (long story). But I got an offer for a loan for far more than any bank would offer with a great monthly payment...one I know I could afford. The odd part is the loan officer or whoever he was said they would first send me a smaller loan that I would pay back immediately (within a few hours/whenever the funds got to my account) to build my credit/build a relationship with this loan company to validate giving me the greater loan amount...additionally they want me to pay back that smaller loan via prepaid visa card??? I hear the visa gift card and I immediately think scam...BUT I am giving them money that they have to send me first??? The only money I would be losing would be the fee for buying the card which wouldn't even go to them. Of course it screams scam...but also believable. Thoughts?

Edited March 10, 2019 by Kman

[Act25]

how are they sending the money? If they send you a bad check it would take a while for your bank to kick it back to you and debit your account. In the meantime you've repaid the "loan".

 

Have not heard of this scam before but my guess is that is how it would play out.

[+ Travis69]

BUT I am giving them money that they have to send me first???

Would that money be in a check? If so i bet that check bounces after you pay them with a prepaid visa card. I say BIG SCAM.

[+ Kman]

Yeah important note, I haven't sent any money. They send me the loan electronically and then I would pay the "small loan" back to them via the visa prepaid card/

[Act25]

if they credit your account with loan funds they can also debit your account...

[+ Travis69]

Yeah important note, I haven't sent any money. They send me the loan electronically and then I would pay the "small loan" back to them via the visa prepaid card/

Still sounds fishy. Why do they need you to pay a small loan? Where did you find this offer?

[Act25]

If you need to work on rebuilding your credit I'd start with credit union or local bank where you can sit face-to-face with a credit officer.

[+ Kman]

Still sounds fishy. Why do they need you to pay a small loan? Where did you find this offer?

The loan officer said, I needed to pay the small loan amount immediately to validate a "relationship" between us and a better excuse to give me more money. The offer can was from a phone call...I have been shopping around online for the loan so my info is out there of course

[+ Kman]

If you need to work on rebuilding your credit I'd start with credit union or local bank where you can sit face-to-face with a credit officer.

 

Yes, I understand a bank would be 1,000 times better and obviously legit...its just that this loan offer is the best I have seen...interest rate and loan amount..that is why I am even considering it.

[+ Travis69]

The loan officer said, I needed to pay the small loan amount immediately to validate a "relationship" between us and a better excuse to give me more money. The offer can was from a phone call...I have been shopping around online for the loan so my info is out there of course

How much money would the small loan be and are you prepared to lose that money if it is a scam? Still think it's a scam. Would calling the Better Business Bureau and asking them about this company be a possibility?

[+ Kman]

How much money would the small loan be and are you prepared to lose that money if it is a scam? Still think it's a scam. Would calling the Better Business Bureau and asking them about this company be a possibility?

...This is the part that makes it not look like a scam...I am only sending the small loan amount back after I receive the money meaning it is in my account and available to use...if there is no money in my account...I am not buying the visa card or sending them money...even if its sitting there in pending mode I wouldn't send it back.

[+ Travis69]

I would still call some agency and see if this "company" is legit. I understand you want it to be legit and solve your problem but I don't think you are doing enough research to protect yourself.

[+ Kman]

I missed the Better Business Bureau part...yeah that is a good idea. I will do that.

[+ Keith30309]

 

Run. This is wrong on several levels.

[maninsoma]

Seems like a scam to me. Let's take the lender at face value and assume that they developed this business practice of "proving" a borrower's creditworthiness by first lending a small amount of money which needs to be fully repaid by a prepaid Visa card. How would that, in fact, prove anything about a borrower's ability to repay a larger loan? Any borrower could surely repay a loan with funds already lent in order to get a larger loan. Then the larger loan is given and the borrower struggles to make regular payments because he doesn't have the proceeds of the loan for repayment -- he borrowed the money to pay other bills or to buy something.

 

Because this doesn't pass the smell test, I assume it's a scam. And, as others have pointed out, one of the long-standing money scams is to get people to accept some money and return some in exchange. You send the scammer actual money and they send you a bad check.

 

If you are in a fragile financial situation, I'd suggest contacting a consumer credit counseling agency. I think they offer at least some services free of charge.

[edjames]

This article outlines the 7 signs to look for when you think you are being scammed for a loan.

According to the article, you do qualify for a "scam".

 

https://www.bankrate.com/loans/personal-loans/personal-loan-scam-signs/

[MiamiLooker]

Why not ask someone at your bank? They are probably aware of potential scams. They could also tell you if the money can be removed from your account without your authorization.

[+ sam.fitzpatrick]

Kman - I am a banker and sent you a PM.

[LaffingBear]

General rule for any transaction or life occurrence..... If something seems TGTBT, it is.

 

One of the most common elements any time something goes wrong in life.... the victim or "sufferer" says something like "I knew it seemed fishy," or "against my better judgment," or "I had a feeling...."

 

Instincts are good - don't suppress them.

[instudiocity]

RUN!

[+ azdr0710]

please don't do this......I want to be able to sleep tonight!

 

this is a classic, much-discussed scam....their requirement that you pay it off within hours is the give-away......meanwhile, the check they sent you bounces in a few days and you're left responsible for those funds.....

[Beancounter]

There’s a reason banks find you credit unworthy and are hesitant to loan you money . I’m sorry your credit rating is poor but you can rebuild it slowly over time. Many people find themselves in desperate financial woes and are suckered in to these types of scams. And yes! This is a scam. Don’t be one of these people. You have other legal options available to you.

[+ Kman]

please don't do this......I want to be able to sleep tonight!

 

this is a classic, much-discussed scam....their requirement that you pay it off within hours is the give-away......meanwhile, the check they sent you bounces in a few days and you're left responsible for those funds.....

I don’t need to repeat what others have said about running away from this...but to validate their advice:

 

https://www.bankrate.com/loans/personal-loans/personal-loan-scam-signs/

 

It seems that you have made the decision not to pursue this and have evolved to trying to figure out how it is a scam...but alas, i suspect they are not giving you all the information yet to connect the dots yet.

 

Out of curiosity, what was the amount of the loan and the payment they offered you?

 

 

 

Thanks for your concern...I did not go through with it...I expected them to call me back a few times today but they did not.

 

Payment was $250 a month for 15K

[+ Kman]

There’s a reason banks find you credit unworthy and are hesitant to loan you money . I’m sorry your credit rating is poor but you can rebuild it slowly over time. Many people find themselves in desperate financial woes and are suckered in to these types of scams. And yes! This is a scam. Don’t be one of these people. You have other legal options available to you.

 

 

Its not that my bank is unwilling to give me money its just want the payments to be lower...the scammer offer was too enticing and I wanted it to be true.

[+ Travis69]

Its not that my bank is unwilling to give me money its just want the payments to be lower...the scammer offer was too enticing and I wanted it to be true.

If it's only 15k you might be able to find a friend or family member to loan you the money on repayment terms you like. Many people like to extend these loans to people they trust as they don't declare the interest received on their taxes. Of course you also can't declare the interest paid. Both parties win but the IRS loses.