If it sounds too good to be true, you might want to be careful
11 August 2020|3 minute read
Some dishonest companies and people will take advantage of those trying to get a loan. Check out our tips below on how to spot loan scam and what to do if you suspect a scammer might be targeting you.
It can be surprisingly easy for scammers to find potential victims. Scammers contact targets via phone, email, SMS or social media. They may even be someone you know or have been introduced to you by a contact.
Scammers can also obtain your details after you have provided your information to a legitimate loan comparison website. In short, they could be (or pretend to be) anyone.
Loan scams come in all shapes and sizes. It might be an offer that does not exist. Someone may claim to represent a reputable company when they don’t. Or ask you to do something that may seem suspicious in order to transfer funds, such as mailing a check. Basically, if it’s a scam, the money you will be asked for will go to the scammer not towards any loan provided.
Scammers might promise quick returns, tax-free benefits, offer an opportunity with little risk, or claim to have insider information. They will likely use high-pressure sales tactics to rush you into making a big and quick decision.
Here are a few warning signs that an offer may not be legitimate or legal.
All legitimate lenders, by law, must hold a credit licence from ASIC. You can check if a lender is licensed on ASIC's website. If they don't have a licence, don't exchange any information with them and you can report them to ASIC.