See today’s offer: Debt Relief – Loan?
Jody was a single mom living in Cleveland and she was REALLY struggling with money problems.
As a result her credit card balances had ballooned way out of proportion.
Since she had bad credit with a FICO score just over 400 based on Equifax, TransUnion, and Experian there was no bank or credit union willing to give her a personal loan.
She was desperate!
And desperation can make you prey.
Prey for loan sharks and online fraudsters who take advantage of people just like her who have no chance of getting approved for ANY kind of legitimate loan.
These con artists tell people they can guaranteed them approval.
Even worse they claim to guarantee the lowest rates – when low APR is only available to people with excellent credit, bulging bank accounts. and swelling assets.
The Guaranteed Debt Consolidation Scam
Before we delve into the specific file on Jody, I want to describe the basics of how these scams work.
Maybe this will encourage desperate borrowers to approach lenders with caution.
Especially when they’re offered a sure thing.
The Pre-Paid Credit Card Scam
The illegitimate lenders ask their rube to go pick up a pre-paid Visa card.
You can buy them in many different shops but the most common places are convenience stores like 7-Eleven, drug stores like Walgreens, and department stores like Walmart or Target.
Then these scumbags tell you that they’re sending you a check in the mail for the loan you want.
You actually do receive the check in the mail and most suckers feel hopeful that it’s the real deal.
They rush off and deposit the check into their bank account and of course it bounces.
Their hopes are dashed and then they find out their pre-paid credit card has been drained.
What these piss-ants do is ask for the 14 digit number on the back of your prepaid credit card.
They come up with some creative reason why you need to give them that number and cha-ching!
They’ve got your money, a piece of your pride, and small bit of your dignity.
Clever bastards right?
How To Avoid The Guaranteed Loan Scam
So it’s really quite simple to stop these criminals in their tracks:
- never give them the time of day unless they’re an established and well known company
- if they ask for upfront fees stop communicating with them
- if they ask you to get a pre-paid gift card or credit card run
- if they ask for ANY money at all stop dealing with them
Anytime they offer you a 3%-5% interest rate even though your credit score is below 600 then you know they’re scammers.
No legitimate lender will ask for upfront fees and they’ll NEVER give you a rock bottom interest rate when you have bad credit.
You must have your bullshit detector tuned in and functioning.
A little bit of Internet research will help you avoid being tricked, robbed, and humiliated.
Jody’s File: The So-Called Guaranteed Approval
Jody told us all about how she got taken for $500 by a loan scammer in a webinar we had for people suffering from bad credit ratings.
First she tried getting approved with a credit union nearby, and then she tried her PNC bank branch, but no joy.
She told us how she found the fraudsters using Google – she had searched the phrase,
“Guaranteed approval for debt consolidation of my credit cards”
What she found at the top were mostly real websites that talked about the reality of consumer lending and what to watch out for, but down in the middle of page three she found a site that looked “promising” (the website is no longer found using Google search because Google is pretty clever at getting rid of fraud sites).
They offered her a SECOND CHANCE LOAN! They offered her a low rate of only 3%!! Then they offered her a long term of 10 years on a principal amount of $25000!!!
Wow!!! Getting better all the time – and the crazy thing about some people is when they’re truly desperate they’re willing to believe almost anything.
Like you can make your hair grow back by rubbing your bald head on the tail of a wall-eyed swamp creature.
So let’s just take a look at what this loan would look like in a visual form shall we.
Yep. Nope…..ain’t ever gonna happen Jethro.
There is no way in hell Jody could be approved for a loan with this rate, for this term, and for this principal. It doesn’t exist baby.
The Loan Jody Was Offered
- principal = $25000
- term length = 10 years (120 months)
- interest rate = 3% (APR)
- monthly payment = $241.40
Approved In The Real World
If she was approved for a $25000 consolidation it would look more like this:
This is no exaggeration friends – when your credit rating goes DOWN your interest rate goes UP!
Note that in reality the bank or credit union wouldn’t likely agree to a term longer than five years and the rate would reflect her Equifax, Experian, and TransUnion scores.
It’s not unheard of for borrowers to pay interest rates in the 25% – 30% range when their credit rating is a bad as Jody’s was, and as such there is no advantage in getting a consolidation loan when the interest is just as high as your credit card rates.
So if the debtor just can’t figure out how to earn more money to properly service their credit card debt they will have to think about settlement options.
A debt settlement is when you negotiate with your creditors to pay a smaller portion of what you owe. This way the collection agent calls should stop eventually and your credit rating will take another temporary tick down.
And Jody Took The Bait
She was very excited when she was told that she was guaranteed to be approved right out of the gate on the same day she applied.
But what she didn’t realize was that she was being led down the primrose path. This is why you need to be careful with online lenders.
When you choose to do business with an online financial institution you have to be really careful and do your due diligence – you need to find out if the company (and I use that word loosely) is a real deal outfit with years of experience providing the exact lending product you’re looking for.
The fake lenders then told her she had to secure her consolidation loan and lock in a guarantee.
She had to purchase a pre-paid credit card in order to secure the deal. Then she was told to provide the 14 digit number on the back of the card.
She was so excited to finally be in a situation where she could see the end of her money problems, she stopped listening to the voice in the back of her head – a voice that told her this loan was bullshit.
The Check Is In The Mail
She was told that her check for $25000 was in the mail.
She was sleeping better and she felt like her nightmare was finally over – little did she know that her $500 pre-paid Visa card was already drained by the criminals.
The big day came 7 business days later when the check arrived in her mailbox. When she opened the envelope she actually thought that this 3% consolidation loan was for real.
She quickly got on the bus and got down to her bank branch to deposit the check.
Two more business days later she found out that it had bounced.
She was devastated.
Finally that little voice in the back of her head was coming forward loud and clear. And worse than that – she was yet to find out her pre-paid Visa card was drained.
The next day she went to use her pre-paid card and found out the balance was under ten dollars. Nice of the losers to leave her some lunch money right.
I would love to get my hands around the neck of one of these criminals – I would squeeze, and squeeze, and squeeze!
Jody In Her Own Words
My name is Jody and I live in Cleveland Ohio and I’m a single mom with two children ages 4 and 7. My common-law husband left with another woman last year and left us stranded without the needed funds to get by.
I’ve been so stressed out because of the horrible calls I’m getting from collections agents. These people are so mean!!!
I just didn’t know where to turn and all I could imagine for my future was bankruptcy. When I came across this website that had amazing testimonials it looked completely legit.
Other people were saying how they too had terrible credit and got approved through their website. I guess I’m just a born sucker and I didn’t know how those pre-paid Visa cards worked and now I do!
When I found out I was scammed I went home and cried – I was so upset because the $500 I lost would have been used to put much needed clothes on my babies’ backs and food in their mouths.
I have an Uncle who is a lawyer in Cleveland and when he heard about the scam I fell for he gave me $1000 dollars just to make me whole again and give me a little help that month. He is now working with me on spreadsheets so I can learn budgeting and bill control.
I got rid of my cell phone, car, and anything else we don’t need and I’m looking for a different line of work. I know a lot of people here because I grew up in Cleveland so I’m confident I will get back on my feet again.
I just want to thank everyone at Debtfiles.com for hearing my story through their FUSA website.
Jody’s file really angered me because I was a single mom at one time too and $500 is a LOT of money in her situation.
All my kids are grown up and out of the house now, but I remember how hard it was to make ends meet and I always had a steady job with The Bank of America.
It may seem crazy to some readers that people with bad credit would fall for such an obvious scam, but like I said above, when human beings are desperate they’ll believe almost anything to relieve their suffering.
This is why the bad guys will always find more prey to manipulate and steal from.
To make matters worse these criminals are hard to catch. They cover their tracks and most of them get away with it for awhile.
The bizarre thing about this is the amount of planning, effort, and work they go through to pull of these “guaranteed consolidation loan” scams.
If they put that much effort and planning into a legitimate business model they would have a good chance at succeeding.
I hope that this humble posting will be seen by others who have bad credit and are actively dreaming of a low interest consolidation loan for 3%-7%.
What they really need to do is make a change in their everyday spending and get a strong grip on their financial reality – which means sticking to a monthly budget and coming up with a sound plan to increase your earnings and decrease your spending.
There are no easy ways out when you have a severely damaged credit score – once the credit reporting agencies have you black-balled you will not be seeing a low interest loan again until you completely clean up your name with Experian, Equifax, and Experian.
The only FAST ways I know to pay off your large debt are:
- win a lottery
- rob a bank
- find a wad of cash in an old spinster’s couch you bought off Craigslist
- cash gift from a GREAT friend
- loan or gift from a GREAT family member
If you can think of any others please leave a comment below.
Thanks for dropping by.