You’ve heard all the horror stories and have watched as friends and acquaintances lose money after believing a too-good-to-be-true email scam. You don’t think it will happen to you until it does. Why? Because these scams are well-thought-out. They use an email address similar to your bank’s. They look and sound the same. It’s easy to fall into the trap because they’ve perfected their modus. That’s why although technology brought the financial industry to the 21st century, it also provided many avenues for financial fraud, banking scams, and identity theft.
In the past year alone, consumers used digital banking more than any other time. They applied for home loans online. They sent requirements through what they thought were secure emails. Borrowers talked with mortgage lenders through various digital means: Facebook Messenger, WhatsApp, Viber, Zoom, and many more. All of these allowed cybercriminals to infiltrate the system and hoodwink borrowers into thinking that they are legitimate lenders offering better rates, terms, and contracts.
Guaranteed Loan Approval
When you see the phrase “guaranteed approval” in an email, don’t you want to click on that ad? It makes you want to apply for that loan, right? No bank can guarantee approval because every loan must pass through an eligibility process. This is not to make it hard for the borrowers, but the protection of the bank. They have to protect their assets. They need to know that you will be able to pay off your loans.
Too-good-to-be-true offers are just that. They’re impossible to find. If you have no money, job, and assets, why do you think banks will guarantee a loan? It’s either a scam or a loan with very high-interest rates.
Request for Funds
Mortgage lenders and their agents will not ask you to pay a processing fee upfront. Banks don’t have upfront fees, and they won’t ask you to wire them money. As a loan applicant, you are trying to borrow money from the banks, so why would they ask you for money? Banks will usually deduct the processing fee from the loan amount once it is approved. When you send a payment for a “processing fee,” that money is forever lost.
You might receive an email from the “bank” that you’ve gotten approval for the loan and you need to click on a link. When you click on the link, it asks you a few personal questions to make sure you are the borrower. So, you enter all the details. The next day, money could be missing from your bank. Refrain from answering these kinds of emails, as well as clicking on links on an email. Banks will usually not ask you to fill up anything digitally. Plus, they will not ask for the same information you’ve already provided to them when you submitted the loan requirements.
Bank employees are not known for their warm personalities. They are usually very cold, strict, and professional. When you notice grammar errors in the “email,” that is a red flag. Bank emails are usually very professional and have the correct grammar, punctuation, syntax, etc. If you visited the website and it’s primitive and barren, that’s another sign that this could be a scam. Bank websites have security features such as the lock sign on the address bar. This will tell you that it encrypts the information you share.
Some websites will tell you that they don’t lend money, but they can help find someone who does. They will ask for personal and financial information, which they then sell to “lenders.” While some of these are legitimate, many will use this information to hack into your personal accounts. Identity theft is a big problem on the internet. The first line of defense will be your knowledge of how to protect yourself. By not giving away your information on fly-by-night websites, you are already building up your defense.
You’re spending several hours on social media a day. This allows scammers to track you. If you’re searching for a lender on Google, this activity can be shared on social media platforms, alerting scammers that they can message you on Facebook, for example. You might feel the need to share information with a “lender” on social media. Don’t do it. No bank will transact with you on something as insecure as a social media platform.
These are not the only ways hackers and scammers can get your information. While technology is a great thing, it comes with a price, too. You have to be cautious of your activities on the internet and share only what needs to be shared over encrypted websites.