Better Business Bureau Loan Companies – As consumers have lost jobs and struggled to make ends meet during the COVID-19 pandemic, many have turned to payday loans and other short-term solutions, and online solutions have proliferated. Not only has this allowed predatory lenders to thrive — many borrowers still struggle with high interest rates and murky fees — but it’s created a fertile environment for fraudsters, according to a new investigative study by the Better Business Bureau ().
Payday loan laws are administered on a state-by-state basis among the 32 states where they are available, and a complex web of regulations makes the impact of US and Canadian industries difficult to track. The study found one common thread, however, the triple-digit interest rates that many of these loans charge — with interest compounded weekly or monthly, rather than annually, as well as transfer fees.
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From 2019 to July 2022, nearly 3,000 complaints were received from consumers about employment loans, with disputes amounting to nearly $3 million. In addition, more than 117,000 complaints have been filed against debt collection companies. Complainants often said they felt misinformed about the terms of their loans. Many fall into what consumer advocates call the “debt trap” of piling up interest and fees, which can cause consumers to pay double what they originally borrowed. One woman who lives in St. Louis, Missouri, recently paid over $1,200 and still owes another $1,500 on a $300 loan.
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Scammers haven’t lost an opportunity to take advantage of consumers either, and Scam Tracker has received more than 7,000 reports of loan and debt collection scams totaling nearly $4.1 million in losses.
Posing as loan companies and debt collectors, fraudsters contact them with stolen information to convince customers to hand over bank account information and cash. In one case, hackers were found to have stolen and posted the detailed personal and financial information of more than 200,000 customers. Reports say it is not an isolated incident.
A Fond Du Lac, Wisconsin woman said she recently received a call from a supposed debt collector saying legal action was pending against her over a past due payday loan. Fearing legal trouble, she ends up sending the scammer $500 and her credit card information. Over several months, her card was repeatedly charged until she stopped.
Federal regulators pursued strong laws to prevent predatory lending, but those rules have been rolled back in recent years, leaving states to make their own rules about interest rates and showings other payday loans. More than a dozen states passed laws last year to regulate payday loans, but the legal landscape for payday lenders is inconsistent from state to state.
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Currently, payday loans are not allowed in 18 states, according to the Pew Charitable Trust. In addition, the Army Loan Act imposes a 36% tax on certain payday loans. When it comes to fraudulent behavior, the police are limited in what they can do to prosecute payday loan fraud. Some legitimate payday lenders have tried to prevent scams by educating consumers about the dos and don’ts of loans.
The study advises consumers to carefully examine all loan options — as well as payday loan terms — before signing up for a short-term loan. The study also includes recommendations for managers: Consumers have informed LendingPoint that LendingPoint’s name and address are being used by individuals who call, text, fax or email consumers about loans. These people pretend to be LendingPoint employees and contact customers, telling them they are approved for a loan or providing documents showing the same. If the customer has expressed interest in the loan offer, the LendingPoint salesperson will request a down payment to secure the loan.
Contact customers asking for money via gift card or wire transfer as a condition for obtaining a personal loan.
Communicate with clients or customers using public email accounts such as Gmail. If the email address is not @LendingPoint.com, it is not from LendingPoint.
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Customers can apply for LendingPoint loans at LendingPoint.com. Customers may be asked to verify information such as identity or income during the application process, but they will never be asked for any upfront fees to receive a loan.
To report suspected fraud by someone impersonating LendingPoint, please contact us at CustomerService@LendingPoint.com or (888) 969-0959.
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Funded over 20k in June 2022. Paid week of 3/13. The system doesn’t allow cents, so that same week we asked to pay the remaining .38 and the agent said they wrote under a dollar, our account is now paid and closed. On 3/20/23 they withdrew $798 from our account. It seems we cannot get our money back and we have been told several things. They stole money from our account without our permission and continue to collect and sue, but no solution.
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Great experience, led by *****. She was kind, nice, caring, and came back to me time and time again. I would recommend it hands down!
Hello ********, thank you very much for your kind suggestion. We are so glad that ***** could improve your experience with us! We appreciate you taking the time to leave us a review.
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When evaluating complaint information, please consider the size and volume of the company’s transactions, and understand that the nature of the complaints and the company’s responses are often more important than the number of complaints.
Consumer Alert: Bbb Warns Of Cash App Scams, Fake Loan Offers
Business data generally covers a reporting period of three years. The business profile can change at any time. If you choose to do business with this business, please notify the business that you have contacted Business Intelligence.
This business is in an industry that may require professional licensing, registration or registration. encourages you to check with the appropriate agency to ensure that any requirements are currently met.
Records show license number 6054644 for this business, issued by the California Department of Business Inspection.
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I was behind on my payments due to the conflict between my jobs, I was able to pay to try and catch up but I was still behind. I know this is my fault. I received a letter warning of repossession because I have been away for almost 3 months, I paid to cover 2 months and I am doing the last one to catch up unfortunately. I was late and the next month came again, and two months of waiting came back. My car was repossessed and I paid 2 days later to add it to my account. I called the next day to speak with a service rep on 3/22/2023, she told me when I paid the car would be released. I called back the next day 3/23/2023 and made the payment, the rep then told me it takes 7 days to clear the payment, I spoke to a supervisor to confirm. He told me it could take up to 7 days but that doesn’t always happen and he will file a claim to see if I can get my car back sooner. The next day 03/24/2023 I followed up and again he said it was 7 days, I spoke to a supervisor and she repeated the same POLICY. I said that I received not only the payment confirmation but also a second email confirming that the payment and my loan application had been received. I was told they would release my car on 3/30/2023 and I asked for an email confirming their 7 day policy. 03/29/2023 I still have not received an email stating the POLICY, I called and the rep told me my car will be released on 3/4/2023 saying they have a 10 day POLICY. My account was cleared by payment on 03/23/2023, Upstart confirmed receipt on 03/24/2023. I was told I could pick up my car on 03/30/2023 and now they have 3/4/2023. My loan is now in place, and you own my property. At this point I need someone to release my car or should I seek legal help as I am still liable.
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