Online Loans Can Cost You Big Money

John and Virginia Hyder are like so many people these days looking online hoping to find a low cost loan.
John says, "We thought this was something that was legit but come to find out we got taken."
They say they went to Lending Tree because they know it is reputable. After filling out their information, they were contacted by Direct Finance out of London and got approved for a loan. That's where the problems start.
According to John, "The fee they asked for upfront was what they call a transfer fee was $1515.00." The Hyders paid it and another $1000 when the company claimed they needed to pay a certificate fee for the Federal Reserve to release the funds. Kathy Barrett with the Better Business Bureau says let this be a lesson to everyone. She says, "Anytime a company is asking you for upfront money to get a loan that is a read flag. That is a big red flag." She says never pay upfront. She also says if the company is not located in the United States that's another sign its probably not legitimate. "Anything that goes out of the United States is gone. You can't get it back. It is not something you can use the law because they are not bound by our laws." The Hyders say they feel fooled because they did research the company and thought since it claimed to be affiliated with Lending Tree and presented them with what seemed to be the right certificates, everything would be fine. Barrett says that's just what these companies are hoping you'll do. "They will use logos from major corporations to try to show authenticity and legitimacy and its not true." John says it's a shame good people like he and his wife have to suffer. He claims, "We couldn't pay our rent this month, we couldn't pay our car payment this month, we couldn't buy groceries this month. I couldn't buy her medicine this month." He hopes hearing his story will make you think twice before applying for a loan on line.
According to the Better Business Bureau, it is best to apply for loans at places locally where you can walk in and talk to the people you are dealing with. If you want to apply online, make sure the company is reputable. Call the state they are located in to verify they are a legitimate business by checking their business license. Do not trust what you read on the internet. It is too easy for scammers to steal logos and make you think they are a legitimate business. Finally, Barrett says if you are getting a loan there is no reason you should have to pay ANY money upfront. We spoke to Lending Tree, the online loan company the Hyder's say they thought they were applying with. A spokesman for the company says unfortunately scammers can get your information once a reputable company looks into your credit. They have 24 hours to buy thye information from the credit bureau. Further Lending Tree agrees with the Better Business Burea and says they will not ask for any money upfront. For more information on their practices click here.