MoneyThumb is the provider of the best-selling PDF financial file converters on the market. Our PDF financial file converters are the choice of legitimate lenders when it comes to converting the financial statements of prospective borrowers of short-term loans.
Today the Rules of Thumb blog from MoneyThumb would like to share important tips that can help you decide if a lender of short-term loans is legitimate. Below are those helpful tips:
- Lenders are legally required to make sure you can afford repayments before you take out a loan. That’s why legit lenders ask about your income, and monthly expenses when you apply. If a lender doesn’t ask you for any of that information, it probably isn’t legit.
- Better Business Bureau accreditation. The Better Business Bureau (BBB) is more than a century-old nonprofit organization that helps identify a trustworthy business. Different short-term lenders across the country have BBB accreditation, and dealing with these businesses provides extra peace of mind.
- Contact details. Take some time to find a lender’s contact details. If a lender provides no more than a contact form or an email address, see how responsive it is before you apply. A legitimate short-term lender shouldn’t shy away from providing a physical address, phone support or live chat.
- Fees and charges. Direct lenders of legit short-term loans are legally required to be upfront about the fees and charges you have to pay during the loan term, and they adhere to all given maximum limits. The loan contract should clearly set out all applicable fees and charges.
- Abides by state regulations. With legit payday loans, you don’t have to worry about lenders charging you more than the maximum limits set by the state. Check the regulations in your state to make sure your lender is operating legally.
- Use the money for any reason. Legit short-term lenders don’t place any stipulations on how you can use loan funds as long as you’re using the money for a legal reason. If your lender tries to dictate how you can use your loan funds, it might not be legit.
- It doesn’t require money upfront. One of the biggest red flags when researching a lender is if it requests money upfront. Origination fees are paid out of your loan amount, and you shouldn’t have to pay anything before you borrow.
By taking advantage of the tips above that the Rules of Thumb blog from MoneyThumb has provided you can pretty much rest assured that the lender of a short term loan is legitimate. However, you should always take the time before you sign on the dotted line to go through the loan’s terms and conditions, as this document tells you how much you may have to pay in different circumstances such as rollovers and late payments.
Some states don’t allow you to refinance a loan or take out more than once within a given period of time. You’ll also have to pay additional fees if you make a late payment, and your lender may report your missed payments to credit bureaus, so make sure before you apply for a short-term loan that you have the ability to repay it.