08 Jun How Do I Spot A Scam Loan Website?
This post deals predominantly with the UK loan framework but some things are universal……….
When life gets tough and things aren’t going our way the last thing we need when trying to arrange a loan is someone trying to steal what little money we may have left. Unfortunately there is a world full of unscrupulous people who are queueing up in an attempt to relieve us of our readies. This post is aimed at arming you the customer with as many tips as possible to dodge the bad guys and keep what you’ve got in your pocket where it belongs.
Start With the Search
Where do we start? Let’s start at the point of entry and that’s an internet search for whichever kind of loan you are looking for. Payday, home credit, guarantor, good or bad credit they are all terms used for loan searches and our problems can start with the results of the search. First off, look very carefully at the web address or domain name. While we can’t tell if a company is fraudulent just by their name, we can become immediately suspicious if we notice 2 names which look very similar but aren’t quite the same. One could be ok while the other is a fraud or vice versa. They could both be fine but we would be well advised to start checking if we’re thinking of using either one. Ask yourself why would someone purposely create a domain name that was almost identical to another existing company’s name if it wasn’t for a shady purpose? They could be huge fans of the other company and want to bask in their reflected glow but we somehow doubt that. The other possible reason is to confuse the customer.
Cast your eyes to the top of this page and look for the padlock next to the web address on the left. If it’s not there, you’re not on a secure site and most loan companies will have invested in HTTPS (which makes the site safe) to make sure their customer’s information stays secure. That’s what the padlock means. Of course if you’re just out to rip people off and disappear there’s no point investing extra money in security so most scam sites don’t bother.
Compare and Contrast
Have a look at this company (don’t worry, it’s safe to click on their page just don’t give them any info), http://www.credit-lenders.uk The site looks genuine and well-presented and they even link to a bona fide genuine company for one of their loans. Dig a little deeper and things start getting murky. For a native English speaker the language used is awful. Anyone can spell these days but you can’t put good syntax and grammar into a spell check. It could be that the owners have recently arrived in the UK but how would you know? A ring to their published phone number gets no answer and a search of their company number at Companies House yields nothing. They look like a scam site. The aim is to get you to fill out their quote form and from there various things could happen.
Let’s keep comparing our site with theirs for just a little longer. One sure way to know if a site is legal and licensed in the UK is to look for their FCA (Financial Conduct Authority) number. Scroll down to the bottom of our page (any page, it’s on all of them) and you will find our FCA number (FRN 747140). Without an FCA number a company is unlicensed. Don’t use them. You have no protection if you do. They might have an interim number but that should also be displayed in a prominent position. Along with our FCA number you will also see our company number which can be double-checked with Companies House to verify who and where we are. We checked Credit Lenders number and it doesn’t exist. We also have our Data Protection license number on display as required. They don’t have one but they are asking you to submit information for a quote. They would have one if they were legit.
Who to Contact
If you want or need to check the status and validity of a UK loan company you can search the FCA register of licensed companies here: FCA Register
If you suspect fraud on a website or have been defrauded you can report it to the police here: Action Fraud
Now we’ve compared a genuine licensed site with an unlicensed one how else can we spot if a site or person is acting fraudulently? There are a few common sense ideas to bear in mind.
A Few More Hints & Tips
If something seems too good to be true it usually is. If you receive unsolicited emails, texts or phone calls offering you ‘guaranteed acceptance’ for a loan, check, check and then check again. Obviously if it’s a household name there’s no need to start checking their company number at Companies House but there are a lot of loan companies out there most people will have never heard of (that includes us). Look for a real world presence. Addresses, working, answered phone numbers. Have a look at their address on Google Maps and see if they are someone’s house or a business.
Be very careful if asked for an upfront payment. Credit brokers are allowed to charge upfront fees but they must declare this on their site in a clear and prominent position. Most companies will not charge you a fee.
You do not need to take out insurance to get a loan.
You do not need to buy vouchers to get a loan.
You do not need to make a first payment to get a loan.
All of the above are used by the unscrupulous to get people to part with their money.
Loan agreements should be clear, simple and easy to read.
The loan company should be easy to contact.
Look for reviews and ratings though these should be looked at closely too as we’ve seen fake reviews advertised online for a few pounds and scam sites will use scammed reviews.
In conclusion, the vast majority of loan companies you will come across on the internet, especially UK based ones, will be legal and licensed and checkable. But there are others who prey on the desperation of people trying to access money. When times are tough it can be easy to overlook the usual checks and balances in the rush to get the money. If someone is urging you to go faster and not giving you time to make a balanced, timely decision then they may be up to no good and you should take a step back and leave it all alone for a day. Give yourself time to reflect. It could be the best financial decision you make.
We hope this helps.