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Consumers lost a total of $1.48 billion collectively to fraudulent practices in 2018 according to the Federal Trade Commission. Debt consolidation, medical bill payment and other services can offer attractive personal loan options and lure in unsuspecting consumers who then learn that the lender was a fraud.

How can you protect yourself? How can you check if a loan company is legitimate? Learn and understand these common signs of a potential loan scam.

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7 signs a lender may be a scammer

1. The lender isn’t interested in your payment history

One of the upfront disclosures you should see is the requirement to pull your credit report before lending you money.

Reputable lenders make it clear that they’ll need to look at your credit, sometimes getting reports from all three major credit bureaus (Equifax, TransUnion and Experian). They need to know whether you have a history of paying bills on time and in full, which offers them some assurance that you’ll be just as diligent about repaying a loan.

On the other hand, the operators of loan scams aren’t really interested in timely repayment. They tend to do the opposite, seeking high-risk borrowers who are likely to fall behind on loan payments and, as a result, incur their excessively high late fees and penalties.

2. The lender isn’t registered in your state

The Federal Trade Commission (FTC) requires that lenders and loan brokers must register in the states where they conduct business. If a lender you’re interested in does not list any states, you could be dealing with a loan scam.

Check the lender’s website to verify a list of states where it legally conducts business. If you don’t find it, contact your state attorney general’s office for further verification. Lenders also must operate under a bank charter, so look for that information on the lender’s website as well.

3. The lender demands a prepaid debit card

Some scammers will require you to provide a prepaid debit card, claiming they need it for insurance, collateral or fees. Legitimate financial institutions may charge a fee for your application, appraisal or credit report, but those charges are deducted from your loan.

A prepaid debit card can be a useful tool for personal loan scams. It’s virtually as untraceable as cash, and good luck reporting it as stolen if you’ve voluntarily given it to a scammer.

4. The lender calls, writes or knocks

Legitimate lenders typically advertise in ways you would expect, such as online or through other mass media. If you get a loan offer by phone, through the mail or even a door-to-door solicitation, be on your guard immediately. According to the FTC, it’s illegal for companies to offer a loan in the U.S. over the phone.

5. The lender’s website isn’t secure

When visiting a lender’s site, what you don’t see can be just as important as what you do see. Always look for:

  • A padlock symbol on any pages where you’re asked to provide personal information
  • An “s” after “http” on the site address — “s” as in secure” — so it shows as “https://www…”

The padlock symbol and the secure address mean the site is protected from identity thieves who steal personal information and sell it to other criminals.

At best, the lack of these safety measures means the lender isn’t concerned about the integrity of the site. At worst, it could mean the lender is leaving your information exposed on purpose as part of a loan scam.

6. The lender has no physical address

Make sure the lender you’re interested in has provided a physical location. (Even then, you will still want to plug that address into Google Maps. In some cases, businesses running personal loan scams will list addresses that are actually vacant lots.)

If you don’t find any sign of an actual physical address, you should avoid the lender. Many operators of loan scams would rather be untraceable so they can avoid legal consequences.

7. The lender pressures you to act immediately

Don’t fall for the urgency plea. One of the hallmarks of loan personal scams is giving you an immediate deadline to take out the loan because the offer expires quickly — possibly even the next day.

A lender that uses this kind of high-pressure tactic could be up to no good. It may be a ploy to get you to make a rash decision.

Here’s how to spot a legitimate lender

A legitimate lender offers multiple clues if you know what to look for. Some of those signs of a real business include:

  • Easy to reach. The lender will have a physical address, telephone number, email available on their website. They may also have an online chat function. They’re easy to reach and have the online presence of an established business.
  • Good customer service. The staff will be trained in customer service and employees of a reputable lender can answer your questions and offer suggestions when appropriate.
  • Interest in credit history. No legitimate lender is going to lend money without checking on your ability to pay it back. Even if they advertise that they specialize in those with poor credit, they’re still going to run a credit report and base their loan options on the findings.
  • Search reviews online. Yelp!, the Better Business Bureau, Google Reviews and other review sites are terrific resources for vetting potential lenders. If you see multiple users tagging a business as a scam online, then it’s best to stay away.
  • Complete loan terms. A legitimate lender will go over the loan terms with you and send them to you in writing too. They’ll be clear about terms.
  • No upfront payment. Legitimate loan companies won’t ask for upfront payment either in cash or gift cards. This is a common tool that scammers use to get untraceable money from victims.

What to do if you think you’ve been scammed

While no one wants to think they’ve been scammed, it does happen. The first thing to realize is that you have options so take a deep breath and investigate.

  1. You will need to provide documentation. So if you have any emails, screen shots, or other documentation, that will help your case, gather and organize them to present to authorities.
  2. Contact your local law enforcement. By filling out a police report you’ll have an official record.
  3. Contact your state Attorney General’s office, the FBI, and the FTC and the Better Business Bureau. With this information, they can better serve and protect America’s consumers.
  4. Talk about it with family and friends. There are many official-sounding loan scams that prey on people. By talking about it, you may help someone else not fall for a scam.

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Bankrate’s Kelly Anne Smith contributed to the update of this story.