What is loan fraud?
Loan fraud comes in a couple of different forms. Perhaps the most common is loan fee fraud, in which individuals will pose as loan companies offering fast loans, sometimes without a credit check. The catch comes when they ask for an amount of money upfront to cover insurance or other costs for the loan, usually meaning it’s a scam.
The second form is loan repayment fraud, where scammers will target individuals who have already taken out loans. They’ll use this information to impersonate your loan provider, sending requests for payments that are supposedly overdue. However, once you pay the money, you’ll likely still owe the same amount to the real loan company.
If you’ve fallen victim to either of these scams, knowing what to do next can be overwhelming. Loan fraud takes advantage of people who are already struggling, which can be particularly stressful during times of the cost of living crisis where many households are barely able to pay their bills.
In this article, we look at the help available to victims of loan fraud and the next steps that you can take to protect yourself from further harm.
Report the fraud
After you’ve realised that you’ve become a victim of loan fraud, it’s crucial to take action right away. The first step is to report the fraud to the police, which can be done through a service called Action Fraud in the UK. They’ll be able to collect all of the relevant information from you and generate a police report, providing you with a crime reference number which will be invaluable as you move into the next steps of contacting your bank and lender.
Contact your bank or lender
As soon as you’ve obtained your crime reference number, it’s time to contact your bank or lender to inform them of what’s happened. Your financial institution can then guide you through the process of securing your accounts, blocking any fraudulent activity and taking steps to protect your account going forward.
Freeze your credit
While you may think that the worst is behind you, fraudsters often attempt to use their newly gained information to further take advantage of the victim. They might try to access your bank accounts or even open new lines of credit in your name, so it’s vital that you go through the process of freezing your credit. This can be done through most of the major credit reference agencies, who will then prevent anyone from accessing your credit report or opening new accounts without your prior consent.
Regularly review your credit report
It’s a good idea to get into the habit of regularly checking your credit report to look for unauthorised usage, particularly if you’ve fallen victim to something like loan fraud. It’s important to remember that loan fraud can happen to anyone, and there’s no need to feel ashamed. Just make sure to stay informed about your credit status and look out for signs of fraud. This way, you can rest assured that your money will be protected going forward.
Debt Help Available
For those who have found themselves with unaffordable debt, there are solutions that can help.
Here at Trust Deed Scotland® we provide advice on all formal debt solutions that are available in Scotland.
Our experienced debt advisers will be able to discuss your situation and provide you with information on all the solutions that would suit your individual circumstances so that you can make an informed decision on what is right for you.
A Trust Deed is an example of one of the solutions that we offer.
A Trust Deed provides legal protection from the people that you owe money to, while freezing interest and charges. It allows you to consolidate all of your debt repayments into just one affordable payment for a typical period of four years. At the end of the minimum 48-month repayment term, the remainder of the debt is legally written off.
Another example of a debt solution that we offer is the Debt Arrangement Scheme (DAS). The DAS, like a Trust Deed, allows you to consolidate your debt into one affordable monthly payment while freezing interest and charges. The difference is that you would pay that affordable payment until the full debt amount is paid.
If you think that a debt solution may be the right option for you, you can try either our WhatsApp debt advice service or Livechat debt advice services, or quickly check your options using our Trust Deed Wizard tool. Call us on 0141 221 0999.