Loan fee scams happen when you’re asked to pay an upfront fee for a loan you’ll never receive.
Advance fee fraud for a loan is now the most common type of scam reported to the Financial Conduct Authority (FCA), ahead of investment fraud.
If you’ve got limited access to mainstream credit, have a lower income or a lower credit rate, then you’re more likely to be targeted by loan fee scammers.
Fraudsters will try to convince you that you can pay an advance fee for a loan, which you’ll never receive.
Some people are persuaded to make several payments before they realise it is an advance fee scam.
If you are asked to pay an upfront fee for a loan it could be an advance fee scam. Here are some of the common signs of an advance fee loan scam:
If you take out a loan with an unauthorised firm, you won’t be covered by the Financial Ombudsman Service if things go wrong.