When you have debts hanging over your head and creditors calling, the pressure can feel almost unbearable. Unfortunately, there are predators out there who know that you're feeling the pressure -- and they don't mind using your feelings against you. If you fall victim to a debt consolidation scam, your financial situation will just go from bad to worse.
Here's how to spot a debt consolidation loan scams when you see them:
1. You are guaranteed an approval.
No genuine debt consolidation loan representative is going to guarantee your approval the first time they talk to you. When a company is genuine, they are going to carefully consider your ability to repay the loan they make you. You'll have to show them that the loan is going to actually help you -- not just be a temporary fix. There are a lot of factors that have to be taken into consideration.
2. You can't find a lot of information about the loan company.
Does the loan company have a street address on all of its paperwork or a post office box? How long has the company been in existence? A lot of scam companies set up shop almost overnight and operate from an overseas base where regulations are lax. They'll use a post office box to hide the fact that they aren't anywhere you can actually visit.
3. You are pushed to take the loan in a very aggressive way.
Nobody should be promising you that this loan will fix all of your financial problems. If the representative is implying that you'd be a fool to pass the loan up -- the odds are good that you'd be foolish to take it.
Naturally, loan officers want to make loans. However, they should only want to make loans if it is in the best interest of both the company and the consumer. Be particularly concerned if you're told that the offer is on a time limit that's very short or you're pushed to sign papers without reviewing them.
4. You see any signs that there might be something illegitimate going on.
What does that mean? It could mean that your loan officer wants you to sign papers that aren't complete -- with the promise that he or she will "fill things in" later. Never agree to something like that.
Similarly, you should never agree to a loan that requires you to make a "good faith" payment before you even receive your loan. You also don't want to agree to give the bank access to your bank account for automatic withdrawals. If you do that, you may find your entire account cleaned out before you know it!
There are plenty of legitimate debt consolidation loan companies available, but it's wisest to invest in debt consolidation attorney services before you start. An attorney can protect your interests and make sure that you are getting the debt relief assistance that you actually need.