There is an ironic twist when you have bad credit and you need your loan application approved as soon as possible—when you’re in dire need of money that’s when no one wants to lend you some all because of your bad credit history. That is why you have to be extra careful whenever you’re scouting for online lenders who are willing to offer online loans to people with bad credit because sometimes those things are just too good to be true and chances are you might be getting into a scam. So if you have bad credit and you need money fast be cautious on how you get a loan otherwise you might fall into something much deeper than your current financial pitfall.

How to Spot a Scam

Most scams that involve people with bad credit histories go like this: scammers offer people with bad credit histories an online loan if they will first send a fee to get that loan. The fees are often small, like $50, so that the person who wants an online loan wouldn’t be turned off with the deal because he or she could still manage parting with his or her $50 for a much more substantial amount of cash. But there are other scammers out there who will ask for a higher fee, up to a thousand or more, depending on how much you want for your loan. The trick here is that the online loan scammers will tell you that the fee is an ‘online loan origination fee’ or a collateral fee for your online loan but once you’ve sent the fee the supposed lender will never contact you again.

Be advised that it is against the law for any lender to promise you approval of your online loan in exchange for a fee.

It is pretty obvious that you are being scammed when you are asked to give money so you could get money—this is not how lending works. There are online loan scammers out there who will ask for an upfront payment and most of them will guarantee that you will get a loan even if they haven’t done any background check on you. This is one of the ways these fraudulent lenders get their targets by assuring them an easy way to secure a loan and when you have a bad credit history it’s quite difficult to find someone who will give you a loan so the thought of getting money with the least bit of trouble can be very tempting.

Another way to spot these online loan scammers is by checking how they will ask for your upfront payment. If they ask that you wire your money to them or use any other means aside from mailing them the money or giving them a personal check then chances are you’re being scammed. The United States have strict laws against mail fraud, which is why most con artists will ask that you send them your money by any other means. They might also ask you for the money via online payment schemes like MoneyPak and Green Money. This way they have a higher chance of not getting caught because most of the money being transferred are done electronically, which is harder to trace. These are just some of the kinds of lenders you should avoid when you are applying for a loan so keep your eyes open and watch out for them.