How to Know if Online Lending is not Legit
Before trying out online lending apps, there are quick ways to check whether a lending company is legit or not. They are the following:
- Not interested in the credit history of the borrower. Scammers offer loans out of the blue for amounts that do not make sense. Legit online lenders will ask borrowers for information and the credit history of the patient.
- A scam online lending will harass borrowers to take the loan and start the application. These scammers will call incessantly, send multiple SMS and even show up at your door for you to proceed with the loan and that is after they ask you to pay an upfront “processing fee”. They will keep on badgering the borrower, pressuring them to take the loan and act immediately.
- The company that a scammer works for is not registered with the Securities and Exchange Commission and does not have a physical address. It is always helpful to visit the SEC website at https://www.sec.gov.ph/ and search for the name of the online lending company to verify its legality. When this verification step is done, borrowers will be able to know for sure whether they are dealing with a reputable business and identify its legitimacy to operate as a lending company in the Philippines.
- Fake online lending companies hide their fees. When dealing with legitimate online lending companies, they make you aware of their fees upfront when you sign the loan agreement. Normally, when a loan is approved, the insurance and the processing fees are deducted from the loan proceeds.
Advantages of Online Lending
When you have checked that a lending company is legit, dealing with the company through their online lending app will present a lot of advantages more than disadvantages. Among the many advantages an online lending app provides are the following:
Fast Processing and Disbursement
Perhaps the most attractive feature of legit online lending apps is how fast the whole process is from the time the application is started to the actual disbursement of the loan proceeds. Because everything is done online, data is transmitted in real time.
Convenient and Accessible
The presence of online lending apps have made access to financial products and services easy and convenient. People no longer have to spend so much time traveling, waiting in queues, printing and filling paperworks for loan applications. People can apply for loans from the comfort of their homes at any time of the day. Applying for a leave of absence from work is no longer necessary and people are able to spend time with their families instead.
Captures and Stores Data of Borrower
Legit online lending apps are able to capture and store data of borrowers for the information that they have submitted through the apps. This makes it easier for companies to organize their records and store borrower information.
Automated and Eliminates Human Error and Judgement
It is natural for humans to make a mistake. But this mistake can be avoided through the use of legit online lending apps because the whole process is fully automated. Human judgment on loan decisions are also avoided because online lending apps base their decisions on factual information as provided through the application supported by the documents submitted. This gives borrowers a level of assurance that their loan applications are processed in the most reliable and competent manner.
Conclusion
Online lending apps are beneficial for those who are looking at fast and simple loan applications. The only consideration that people must always remind themselves of is to verify whether the lending company that they are dealing with is legitimate or not.
Checking for the legitimacy of online lending companies can be done by visiting the SEC website and borrowers are advised to use a high level degree of caution at all times and take the time to ascertain whether they are dealing with legit online lending apps or scammers.