Credit Counseling, loan scams, and you

At Advantage CCS, we provide credit counseling and debt management services to clients who have been the victims of predatory lending. The face of predatory lending varies widely. It can come in the form of a bogus business loan or a subprime mortgage. All predatory lending has one factor in common: You, the consumer, is going to lose.

Are you in credit counseling because of an advanced-fee loan? Don't make the mistake again.

Don't fall for credit -destroying scams, otherwise known as advanced loans with fees attached.  Individuals who need credit seek out loans, and all seems innocuous enough - at first. When the promised loan never materializes, it is usually already too late - the scam artist has made off with the money, and the consumer is left empty handed.

The warning sign that these loans are credit score -ruining scams are numerous. Here are but a few red flags that indicate you're dealing with a scam loan:

-         Responsible lenders do not loan money to people without checking their credit scores and histories, nor do they loan to anyone who has a poor credit history.

-         Responsible lenders also do not require advanced payments over and above the money you will owe on the loan. Application or credit evaluation fees are ethical, but these fees are part of the total sum borrowed.

-         Ethical lenders do not ever promise a loan before a consumer even applies. Why would a company risk lending to someone with a bad credit history and bad debt management patterns?

-         Good lenders use secure methods of data transmission. They do not ask for your information without guaranteeing a secure server and secure data encryption. Be especially wary of lenders who solicit over the telephone. You likely have no idea who is taking your personal information - and worse, you can't control where it ends up.

Good lenders don't let you wire money. If you're asked to pay a fee up-front, in cash, for a loan though a wire service such as Western Union, you should turn down the offer. There is no accountability for this kind of action, and if something goes wrong with the transmission, you'll have no recourse.