Payday loan scams are a reality due to the large demand for and ease of obtaining of Internet payday loans. In order to avoid these scams, research can ensure that the company you are selecting for your cash advance is reputable. Review current paycheck loan rules and cash advance laws, and do not enter into unsolicited agreements, as these are typically scams. Never pay up front for a loan, and be careful about giving out bank account information.
Use caution when entering into agreements on the internet. It is simple to make a website that looks secure and professional. The key is to ensure that the company actually is reputable and in good standing. Check with the Better Business Bureau and ask friends and family members for information. Typically, payday loan companies that also have physical buildings are a solid choice. Many payday loan choices are hurried, due to an immediate need for cash, but avoiding payday loan scams is worth the extra research time.
Laws in the U.S. regarding cash advances and payday loans have been changing. Review the laws regarding what kind of interest can be charged and the consequences of being unable to repay the company. Read any contracts and agreements carefully before signing and accepting funds. Some loan companies have an interest rate over 500%, so read the fine print and all stipulations before accepting the offer.
Generally, as you start filling out online applications for a payday loan, your information is immediately sold to other businesses. You will begin receiving emails, text messages, and phone calls from numerous companies offering you payday loans. Usually, these soliciting tactics include "too good to be true" offers which are usually a sign of payday loan scams. If your email account has flagged the offer as spam, it probably is.
Of course, you will need to repay the loan with the interest and any fees assessed. You should not, however, pay anything up front for a loan. Companies that request funds prior to dispersing a loan are most likely payday loan scams. The company may take your money and never disperse any funds to you.
Many companies insist on a bank account number and routing number in order to electronically transfer the money directly to you. These are not always payday loan scams, but be a little wary of these companies, as they will also collect funds electronically from you. When you sign the loan agreement, you allow the repayment to be taken out every month or on a specified day. Remember, the company is able to take any amount they choose once they have that information.