Payday Loan Scams: The Empty Promises of Phone & Advance-Fee Loans

One unfortunate side effect of a recession is the preponderance of scammers trying to make money by conning those who are already in dire straits financially. This may come in the form of “debt consolidation negotiators” taking advantage of homeowners behind on their mortgage payments, or, in the case of the payday loan industry, phone and advance fee loans.

According to the Federal Trade Commission, “It is illegal for companies doing business in the U.S. by phone to promise you a loan and ask you to pay for it before they deliver.” This means that if you receive a phone call from a person claiming to work for a legitimate quick cash loan provider, be careful not to agree to anything. If they request an advance fee, you can be sure they are breaking the law.

If you come into contact with one of these criminals please check the CashAdvance.com Consumer Resources section for your state. By clicking on the Consumer Protection page, you can find the contact info of the organizations in your state that deal with this type of criminal behavior.

Let the user community know about what happened to you, get tips and advice from other customers, and learn from their experiences by posting on The Scam Report, a scams community forum. For additional information, send emails to scams@cashadvance.com. Your personal information will never be release, but please not that the information in emails sent to this address may be used to create advisories and alerts.

The FTC lists a number of different warning signs that you may be dealing with a con artist. Some borrowers have reported receiving phone calls for loans from callers claiming to represent reputable lenders, even CashAdvance.com. You can be sure they are scammers as CashAdvance.com will never contact you with requests for money or personal information.

Another way to tell if you are being scammed is if the caller tells you that you are guaranteed a loan. No lender can make a guarantee that an applicant will be approved for a loan unless they are not a legitimate lender. This also relates to any caller who does not require a credit history. While cash advances can be given in many states without a credit score, receiving a phone call from someone who is not even aware of your employment status should raise a red flag.

Finally, if you are ever asked to pay an individual for a loan, this is because they are not a legitimate business. Never sign or approve any payment unless it is to a registered lender in your state. For more detailed information on spotting a scammer and other related articles, check the phone fraud page of the Federal Trade Commission.

CashAdvance.com is not a lender and does not make loans or credit decisions. CashAdvance.com provides a loan request service only and is not acting as a representative, agent, or correspondent for any service provider or lender. Consumers are encouraged to consult CashAdvance.com’s State Consumer Resource pages to learn more about the risks involved with cash advances and local laws and regulations governing cash advances.