December 26, 2007
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Beware of Fraudulent Loans

Here is a  common fraud scam:

You need money, so you get a loan.  However, to get the loan, you have to pay money up front.  In the end, you never get your money.

More and more people and businesses are getting roped into fraud situations, where they pre-pay to get their loan – and then never get their loan.  What I have been trying to figure out is why would a business pay out money, when what they need is to GET money.  Something isn’t clicking here for me.  Of course, in the fraud cases, no one even got any money except the perpetrators.  But even if you are dealing with a reliable institution, it seems to make more sense to GET money first, and then pay it back. 

I would think that con-artists would need to offer something better that what is out there, but when you contrast this scam with what is offered by legitimate business cash advance companies, you wonder why businesses would even WANT to work on a pre-pay basis.  With business cash advance financing, YOU don’t even pay back the advance – because it isn’t a loan.  Your credit card receipts pay back the advance.  That’s why you can have bad credit, or no credit.  How nifty is that?

Anyway, if you ARE considering an advance fee loan, I highly recommend checking out this article on advance fee loan fraud.

Don’t pay money when you need money; get a business cash advance.

I hope to post this week some tips on how to spot a loan scam.

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