Key Takeaways
- Scams and frauds have become extremely common in our modern lives
- There are several ways to identify a pre-approved loan scam if you are careful
- Paying attention to the pre-requisites stated by the lender can help differentiate between a fraud and an authentic offer
From phishing scams to advance fee loan scams, the various methods through which scam artists are attempting to part you from your money are on the rise. Scams have become an unfortunate part of our modern lives and having to navigate through a new type of fraud each day is distressing. Especially in a year where the global audience is already faced with unprecedented financial challenges, the additional burden of loan frauds is the last thing anyone wants.
A pre-approved loan offer fraud is a common type of loan fraud. An over-enthusiastic caller pretending to be an executive from a reputed bank offers you a pre-approved loan with unbelievable interest rates and other incentives. Before you get all excited and act on this information, take a moment and analyse the situation – it’s just an elaborate strategy to dupe you into sharing your information and stealing your money.
Luckily for you, there are a few ways you can recognize these fake pre-approved loans and save yourself from being cheated. Look out for the following red flags when dealing with loan offers.
Credit History: Your credit history is a reflection of your performance as a responsible borrower. Therefore, it is crucial for any reputable and authentic financial institution or bank to run a background check on you and confirm your credit history. It shows if and when you have failed to return the money within the specified time for your previous loans. This gives them the signal to either go ahead with your loan application and whether they can trust you with the money. This is an important parameter and is not disregarded by any reputable institution. Only a fraudster would be willing to let go of your credit history and provide a loan without any background check. On the contrary, if you are someone who has a bad credit score, the fraudsters tend to benefit more from penalties and extra charges that they levy.
Processing Fees: Asking for a processing fee to get your loan approved is a major red flag of loan fraud. Financial institutions and banks never ask for a legal fee or processing fee to approve your loan. Even if any such charges are levied, they are deducted from the loan amount before it is transferred to your account. Any lender asking for legal fees to sanction your loan should never be trusted. Make sure you cross-check all the details and run a background check on the lender if you are faced with such a request.
Unrealistic Incentives: Be it is a pre-approved loan or a personal loan fraud, the lenders contact you with a phone call and try to garner your interest with offers you just can’t resist. Extremely low interest rates and attractive incentives are often the first signs of a loan scam. All lenders who claim 100% approval on your loan applications are people you should not trust. This is a guarantee that no one can provide. Several variables impact your loan approval and guaranteeing the same without any background check or the processing is a clear sign that something is not right.
There are several other ways to identify a pre-approved loan fraud such as the approval letter. Most fraudsters tend to make some sort of error in the letter. It could range from grammatical errors, false addresses, and misspelled company names to reference numbers, date of approval, and signatures. The Bajaj Finance approval letter shown below is an example of how these fraudsters present you with approval letters but tend to commit mistakes.
For any such queries visit https://www.bajajfinserv.in/reach-us
Savdhaan Rahein. Safe Rahein.
