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3 Key Pointers to a Business Loan Scam

There’s a growing number of funding options available for small businesses that traditional banks are often less willing to finance. Unfortunately, scammers are coming in to take advantage of the situation with the aim of duping unsuspecting small business owners.

These illusory characters operate both within the United States and from outside the country. They can steal money or personal information from innocent businesses by posing as legitimate loan brokers, lenders or other small business funding services willing to help out.

Admittedly, it can be challenging to single out these unscrupulous individuals and companies from the plenty of reputable, legitimate funding options in the market if you have no information. However, these 3 pointers should help you identify a suspicious option and keep you safe from the trap set by loan scammers.

  1. Loans guaranteed

A legitimate lender cannot guarantee the approval of a business loan of any nature before they receive application for the same. Every loaner will want to at least review your financials and reach particular agreements with you in order to administer the credit service. As such, if anyone provides a guarantee that your loan will be approved even before you actually apply for it, chances are that such an entity is up to no good.

  1. No physical address

There are several loaners that are based online. However, when you get in touch with them, you’ll often realize that they have a physical office address that you can always visit and meet them in person.

These are the legitimate lenders in the in the realm of small business financing. But be wary of any supposed credit service that cannot provide you with a verifiable physical mailing address. You might be dealing with a loan scam operating from some country outside the US.

  1. Asking for some money upfront

Credit services do not require that you pay any money upfront to a lender, loan officer or broker.

In case someone does, and in the process of applying for a loan you are asked for a registration fee, a down payment, credit check fee or any other payment whatsoever, consider it a red alert. Dash off before you are duped.

There are a host of legitimate business loan services in the country. You just need to know where to look. Brokers at work for free up front. They are paid in the form of a percentage commission from the lender. This happens after a loan deal has been finalized. Contact us for any information.