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What is a Personal Loan? How to Avoid Scams

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What is a Personal Loan? How to Avoid Scams

A personal loan is money you borrow from a lender for your own private use. The lending institution can be a bank, investment broker, or private lending company. You can apply for such a loan in your home town or on the internet. Personal loans can be used for a variety of needs including a vacation, vehicle repairs, education, medical expenses, home repairs or remodeling, legal bills, and debt consolidation.

The average personal loan maximum is $15,000. The amount you are eligible for will depend on the lending institutions guidelines for such loans, your income, and your overall credit rating. A personal loan is often confused with a line of credit. The major difference between the two is that a personal loan is a lump sum amount of money issued to you by the lender. A line of credit is similar, but you have access to funds up to your credit line that you can access all at once or just what you need, when you need it.

Personal loans can be either secured or unsecured. Secured loans mean you will offer the lender some type of collateral that they can claim in the event you don’t repay the loan. This can be a vehicle, land, or other asset you own. Unsecured personal loans mean there is no collateral. The interest rates for unsecured loans are higher because there is a greater risk of non-payment.

The terms of a personal loan are generally one to five years. The terms of your loan will depend on the lender and the amount of money you borrow. It is important that you understand the loan terms prior to accepting the funds. While a longer loan term will result in lower payments, you will end up paying more for the loan over the life of it due to the amount of interest. Keeping that in mind, only borrow the amount you need for your specific purpose and pay it back as quickly as you can. Make sure the set monthly payment is something within your reach on a regular basis so you are not likely to default on the loan.

The most common use of a personal loan is to consolidate other debts. This is a great way to have one monthly payment and reduce your monthly expenses. However, this scenario only works if you are willing to set a budget and life within the boundaries of it. Too often, a person who gets a personal loan to consolidate their debt racks up huge debt again quickly. Then they not only have that debt to pay again, but now they have a personal loan payment to meet each month as well. It is wise to enroll in a debt management course if you feel you may be at risk to continue the cycle of accumulating more debt. These can be taken for free at many non-profit credit counseling centers around the Nation.

Personal loans are a great way to access the money you need quickly. The application process is simple. You will generally need to verify employment, income, and residence. The lender will pull a credit check. You will likely still qualify for a personal loan if you have bad credit or no established credit. However, be prepared to pay a higher interest rate and have some type of collateral to offer.
How to Avoid Scams

Personal loans are a great way to generate the revenue you need for a variety of needs. Such loans can be secured by banks, loan companies, private investors, and online lenders. It is important that you are aware of personal loan scams and how to avoid them. This type of scam was ranked #5 in the United States for the year 2000. On average, each person scammed lost $464. As a result, the Federal government has been working hard to educate the public about such scams.

The advanced fee personal loan scam is the most common method of taking your money and running. Most victims of such a scam never report it to the authorities because they are embarrassed that they feel for such a ruse. Victims also feel angry. They obviously needed money or they wouldn’t have applied for a loan in the first place. They now have less money than they did to begin with. Those who do report the scam are often frustrated because the perpetrators are very seldom caught and brought to justice. It is very important that you do report any such instant of advanced fee personal loan scam. If you don’t, you are further enabling the predator to do it to others.

Advanced fee personal loan scams work on those who are desperate for a loan, over trusting, uneducated, and who have bad credit. More than half of advanced fee personal loan victims are under the age of 30. The lender tells the applicant that they guarantee they can work with their situation, but that there is a loan processing fee involved. This can be a fee hundred dollars or more. With the technology available now, it is not uncommon for the operators of these scams to have websites and even 800 numbers for you to call. They will send you letters that look so official, you won’t give them a second thought.

To protect yourself from falling victim to advanced personal fee loan scams, be careful who you attempt to borrow from. Make sure they are a reputable company. If they are an online business, check them with the Better Business Bureau. Make sure you enter there business name exactly as they list it. A well known practice of this scam is to use a name very similar to an actual reputable lending institution that applicants may be familiar with the name of.

How To Avoid The Scams On eBay

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How To Avoid The Scams On eBay

Are you looking to start buying on eBay? If you have never used eBay before, you may not necessarily know that it is relatively easy to fall victim to an eBay scam. While eBay is considered a safe place to shop online, there are a number of eBay scams that you should be on the lookout for. Knowing what these scams are, before you start shopping on eBay, will help to reduce or completely eliminate your chances of becoming a victim.

Before we start to examine some of the most common eBay scams that you should be on the lookout for, it is important to mention why those scams exist. eBay is considered an online market place or an online auction website. Just about anyone with an internet connection and an eBay account can start eBay sale auctions. This is what makes it possible for scammers to trap innocent shoppers like you. While eBay does work to combat these scams and eliminate the individuals behind them, there are some people who slip through the cracks. That is why you will always want to be on the lookout for eBay scams.

Speaking of common scams to be on the lookout for, one of the most common scams involves selling a product that the seller actually doesn’t have. This type of scam is sometimes difficult to spot, but there are signs that you should look for. When posting an eBay auction, an eBay seller should have pictures of the item or items that they are selling or at least accurate descriptions. With some items, such as books, CDs, or movies, eBay sellers are given the option of using a stock photo; one that is provided by eBay. All other items should have a genuine photo, taken by the seller. If not, you may want to refrain from making the purchase, as it may mean that the seller isn’t even in possession of the item or items that they are trying to sell you.

In addition to selling items that they don’t even have available, another common eBay scam involves lying about the items that they do have. For instance, there are some eBay sellers, although a small number of them, who claim that they have an item, like a car radio, which is in brand new condition, but it isn’t always. It is not uncommon for some eBay seller to outright lie or strength the truth a little bit. Unless you have a watchful eye, you may not find out until it is too late. That is why it is advised that you not only purchase items from eBay that are accompanied by pictures, but that you also examine those pictures. You will want to try and see if something really does look new or if it is in “like new,” condition.

Another common eBay scam that you will want to look for involves those who want your personal information. This type of scam is implemented in two different ways. First, there are a small number of sellers who tell you that they need your credit card information, but they shouldn’t. Whether you pay by PayPal, personal check, or money order, you shouldn’t give out any personal information to any eBay sellers, even if you are buying an item from them. If you are not using PayPal, just send a check or money order to the address given to you, nothing else needs to be done.

The second eBay scam that involves trying to get your personal information is phishing. Phishing scams are increasing in popularity, making it easier to fall victim to one. With phishing scams, a scammer sends out an email that looks like it is from eBay. The email is often accompanied with a message stating that something is wrong with your account and that you need to click on the attached link, sign in and fix it. This is a scam. What they are trying to do is get your eBay account information. Once that has been done, they may have access to stored personal account numbers, as well as the ability to use your eBay account to make fraudulent purchases.

The above mentioned eBay scams are just a few of the most common ones that you may run across. Although there are those on eBay who are trying to scam or take advantage of you, the chances of falling victim to a scam on eBay are actually quite low, as long as you proceed with caution.