With society struggling as a whole to get by financially, it’s easy to fall into money scams or cash frauds. These scams either by email or phone call have been becoming more convincing and seemingly safe.
What’s A Payday Loan?
A payday loan is essentially a cash advance. It is being able to acquire a certain amount of money, instead of interest, for a varying fee that is to be paid back by the borrower’s next paycheck. Although it is a short-term loan, many places charge the maximum amount of fee available within their particular state. For example, Illinois is $15.50 per 100 dollars lent. For borrowing such a small amount of money, it is a pretty inefficient cost.
Virginia Man Scammed
Around the end of May in 2013, a man in Virginia incoherently fell for a payday scam through a fake representative of Elite Cash Wire. It was required of him to send a $420 fee for a loan of $2,500. The fake representative sent an email that claimed the man was approved for the loan, but the fee was required before the money was supposed to be sent. The man even received a call allegedly from BB&T bank, however it was a sort of fake number that tried to appear as if it was the legitimate bank. Cash scams like this are quite unfortunate since there is no conceivable way of retrieving the money back, and they are all-too common.
Payday Loan Telephone Scam
In another unfortunate case in Virginia, the Pulaski Police Department received numerous complaints about a payday cash advance loan telephone call. In certain cases, the caller threatened its victims and encouraged them to pay a loan that was never even due in the first place by using a prepaid credit card. They claimed that they were a part of a collection agency that worked alongside the loan company. Wiser scammers would be knowledgeable of the fact that it would seem much more legitimate had their phone calls had a working returnable call. In the case of this scam, victims who attempted to call back had noticed that the line had been either disconnected or was presumably out of service.
When looking for a legitimate payday loan, it is best to avoid any red flags that could point out any potential scams—especially online. It is much easier to disguise anything suspicious when not in person. Some things to search for are websites or companies that lack a legitimate address or phone number, companies that are located overseas, if the loan seems too good to be true, and if payments are asked for via a wire transfer. Never give out important personal information online whether it is a Social Security number or financial information unless the company is legit and can be verified.
Legitimate payday loans will surely have a higher fee, and is definitely not recommended for those who are always strapped for cash since it only furthers someone into a deeper debt. For those who are not cautious they can be risky as well. It is wise to treat it as a sort of plan B.
Rachel is a finance graduate and pursuing her masters in accountancy from a leading university in Bristol. She reviews pay day loan companies like Full Pocket for their service and writes resourceful blogs helping others to understand the in and out of attaining a Pay Day Loan from lenders like Full Pocket