What Are Payday Loan Scams?

There are many payday loan scams out there that regularly hurt consumers. Here are a few ways that payday loan scams take advantage of borrowers.

Up-front Fees

One of the most common problems with payday loan scams is that they charge up-front fees. Many times, they will ask you for your banking information and claim that they will distribute your money directly into the account. However, many of them will instead deduct some type of administration fee directly from your account. There may be any number of other fees associated with this service as well. These fees can really add up and defeat the purpose of getting a payday loan.

Early Check Cashing

With a payday loan, many times you will be required to write a post-dated check and give it to the payday loan company. They will tell you that they will give you the money that you need and then cash the check once you get paid. The check will be written for more than the amount that they gave you in order to cover the fees associated with the loan. The problem is that, often, they will cash the check before the date that you have written.


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