In what seemed like the biggest swindle of this century, over the past three years many of us had our jobs, retirement funds, and economic stability disappear before our eyes. As the ‘Great Recession’ settled over America’s and the world’s economies like a choking cloud of smoke, a few choice dirty words echoed through the haze: Mortgages! Credit! Bailout! As our friends, coworkers, and families struggle to find footing and clarity in this unsettling economic environment, we often find ourselves in precarious situations. Is getting a loan what I need, or will it push me into more debt in the long run? How about a credit card? Do I need a second job, or a second mortgage?
It is not in the scope of what we do here at Scambook to dissect what led to the recession, nor can we tell you what is best for you and your family as far as your financial planning is concerned. What we can do, however, is steer you clear from some major creeps who prey on the unfortunate economic uncertainty that has plagued our country and communities around the world. Here are the worst of the worst: the scammers that offer you a helping hand and then kick you while you are down.
Online Mortgages
When someone is willing to give you a lot of money on the quick and easy, your ‘I’m getting ripped off!’ alarms should be going crazy. Not only were cheap and easy mortgages of the mid-2000s one of the reasons our money disappeared in a puff of smoke, but there isn’t a business in the world that succeeds by giving away more money than it takes in. Casinos, lotteries, and banks all know when they pay out a big chunk of money, they will eventually be getting a great deal more in return.
We already covered online payday loans on this blog, and online mortgages can be similar but worse. Not only can a bad mortgage cost you your home, but many of the sites offering easy mortgages are simply fronts to steal your financial information. While you give them all your details with the hopes of acquiring some financial assistance, they are selling your information to third parties, or worse, using your data to rip you off directly.
We have also been getting troubling reports recently about companies that take money from your account when you haven’t even entered your information; for example, ‘scrubbing’ your hard drive for credit card numbers or poaching your saved information from other sites. So, if you are searching for loans or financial help online, find out which companies are reputable before visiting their sites. Search Scambook to see if other people have had a bad experience. Also, government agencies like the FDIC and the FBI prevent and punish mortgage fraud, so take their advice to heart.
Loan Payments in Advance
We have also been receiving quite a few reports of people being roped into a type of wire fraud where a company approves you for a ‘loan’ even though your credit isn’t great. They offer to help you out financially, but you will need to make the first few months’ payments in advance to show that you are good for the money. It sounds like they are doing you a big favor: they will help you out with a big loan so long as you show that you are trustworthy and have some money on hand.
It turns out that you are the only trustworthy one in the arrangement. While you are paying them upfront for money that has yet to be delivered, they are taking your ‘advance payments’ straight to the bank. After you pay for a few months, they string you along and say the loan will be coming after the next month’s check, then the next month’s, and then the next month’s. Soon enough you will have handed them thousands of dollars for a loan that never existed.
Seeing Clearly
Don’t be fooled by the promise of lots of money for a little upfront. It is a recurring theme in wire fraud scams, and you need to do your research to make sure the company you are interacting with is reputable. This can be especially hard when your credit is not in the greatest shape, but having bad credit is all the more reason to be careful about shady lenders. While you are just trying to get a leg up, they might take your feet right out from under you and steal the last of your cash on hand.
One more thing: being educated about who you do business with will help clear the haze of this recession. While our nation’s financial slump is prolonged in part because reputable banks are wary about doling out loans, it is also prolonged because common citizens are afraid or unwilling to use their money and resources effectively. The more educated we all are, the more confident we are in our transactions, and the less of our hard earned cash and confidence is lost to the scammers hiding in the smoke and shadows. Use Scambook and other reputable sources to clear the air before moving forward financially, and we’ll all be back on our feet in no time.
See Also
Don’t Let Payday Loans Trap You in a Vicious Cycle of Debt
FTC Consumer Alert: Auto Loan Scammers
Debt Collection Scams: Warning Signs & Safety Tips
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