Loan scams are on the rise, and they often target people who are already facing financial stress. Fraudsters promise guaranteed approval, low interest rates, or "no credit check" loans, but require an upfront fee before funds are released. Once the fee is paid, the scammer disappears.
According to the Federal Trade Commission, advance-fee loan scams remain a common tactic. Remember: legitimate lenders will not ask for payment before issuing a loan.
Red flags to watch for:
- Upfront fees for "processing" or "insurance"
- Guaranteed approval
- Pressure to act immediately
- Requests for payment via person-to-person payment service (CashApp, Apple Cash etc.), gift cards, wire transfers, or cryptocurrency
- Unsolicited loan offers by text or social media
- Requests for your online banking credentials to "deposit" funds
- Sponsored internet search results that seem "too good to be true"
Another common part of this scheme involves a scammer sending a check or depositing funds into your account, then asking you to send a portion back to "prove you are trustworthy" or to cover fees. The original check later bounces, leaving you responsible for the full amount including the money you sent.
If you suspect a scam, stop communication immediately and contact us directly for support at 1-800-535-2129 and report it to the Federal Trade Commission at ReportFraud.ftc.gov.