Key Takeaways
- The pandemic has been serving as a perfect breeding ground for fraudsters
- Most common targets of home loan scams: Those actively searching for a home loan and those who have been denied one in the past
- Red flags you should never ignore
Online scammers or fraudsters are a group of people that benefitted the most from the economic impact of the outbreak of Covid-19 in India since March 2020. While most of us were hunkered down with just our laptops, smartphones, and streaming devices to keep us entertained, these predators had us exactly where they wanted us.
Purchasing a home is one of the biggest decisions and since it is a long-term commitment, even a minor oversight while applying for or taking a loan can result in a huge financial blow for the bearer. Often, scammers prey on individuals who have been denied a home loan in the past. Let’s discuss some of the tell-tale signs that act as indicators and help differentiate a fake loan offer leading to a home loan fraud from a genuine one.
Home Loan scams
For someone in need of a home loan who also has a poor credit score, it is easy to accept almost anything which is conveniently available. This is where scammers turn your vulnerability into their opportunity. They might offer you tempting home loan offers via calls, SMSes, emails that are guaranteed, irrespective of your credit score or history. Mentioned below are some of the warning signs that you must be mindful of while going for a home loan:
Upfront Fees — This involves the scammer asking you for an upfront payment in return for a low-interest loan. They conceal their actual intent with fees meant for legitimate-sounding purposes such as processing, applications, documentation, etc. If you are asked to pay money in return for a loan, it's a scam. Bajaj Finserv never asks for an upfront fee as loan processing charges in advance. The processing fee is deducted from the loan amount at a later stage and you never pay anything for availing of a loan.
Phone Offer or Wire Transfers — A discount or scheme offered on a loan via a call is likely to be a scam. A genuine offer can always be verified. You should never wire transfer to any individual or business for ‘instant approval’ or ‘quick disbursal’ of your loan. Always crosscheck the lender’s physical address, mailing IDs, website domain, social media handles, etc. If a business is legitimate, you should be able to verify it.
No Interest in Your Credit History — Ever came across an ad or SMS that says, 'Bad credit? No problem!' No official lender will be willing to lend you a home loan without evaluating your creditworthiness. Scammers, on the other hand, are merely interested in your money and will give you the type of offers that best suit your situation.
Copycat Name — With an aim to appear legitimate, scammers often keep a business name or a website URL which reads like a legitimate business. Therefore, it’s important to pay attention to the website URL. Also, look for “HTTPS” in the website URL, which indicates the website is safe and secure. Scammers impose to be from legitimate financial institutions but when you inspect their web address or landing pages, you’ll find subtle clues such as misspellings, and other grammar and language-related loose ends giving away their unverified status.
Red Flags — If a home loan offer appears too good to be true - like a pre-approved loan without any eligibility parameters such as CIBIL Score check or with any collateral requirements - it's a scam. If the lender creates a sense of urgency saying the offer will run out and asks you to act immediately, it's a trick to defraud you. Be suspicious of emails containing spelling, grammar, punctuation, or capitalisation errors.
How to Spot a Legitimate Business
- Research everything about the company - the phone number, original social media handles, website URL, physical address, customer support numbers, state license number, etc., along with the name of the person representing the company
- Ensure there’s no problem reaching out to the company’s physical address
- Determine whether the physical address matches with the company address registered with the phone number and the license number
For any such queries, visit https://www.bajajfinserv.in/reach-us
Savdhaan Rahein. Safe Rahein.
