This episode of "Joe Knows Better" discusses the complexities and potential dangers of obtaining personal loans, particularly online. Host Joe Ducey, along with guests Andrea Mosher from Desert Financial Credit Union and Michelle Marin from the Better Business Bureau, delve into the prevalence of loan scams and offer advice on securing legitimate loans.
Key takeaways:
- Beware of online scams: Many online lenders are unregulated and may engage in fraudulent practices, such as demanding upfront fees, requesting payments via gift cards or Bitcoin, and depositing fake checks.
- Verify lenders: Research lenders thoroughly, check their registration and licensing, and look for reviews on reputable sites like BBB.org.
- Red flags: Be wary of lenders who guarantee approval, demand upfront payments, communicate solely via text, or ask for banking information before establishing legitimacy.
- Build a relationship with a financial institution: Establishing a relationship with a credit union or bank can increase your chances of loan approval and provide access to financial counseling.
- Understand loan terms: Carefully review loan documents, including interest rates and fees, before signing.
Tips for obtaining a legitimate loan:
- Check BBB.org: Research lenders and look for accredited businesses.
- Ask for documentation: Request loan documents before signing any agreements.
- Verify contact information: Obtain a phone number and address to verify the lender's legitimacy.
- Avoid upfront payments: Legitimate lenders typically incorporate fees into the loan itself.
- Be cautious of text-only communication: Avoid sharing sensitive financial information via text.
- Improve credit score: A better credit score can lead to more favorable loan terms.
- Establish a history with a financial institution.
- Ask for financial counseling.
The episode emphasizes the importance of due diligence and caution when seeking personal loans, urging listeners to prioritize reputable financial institutions and avoid suspicious online offers.
