Thursday, March 12, 2009

Small Business Loan Scams

Small business loans scams are on the rise. Unscrupulous "loan brokers" are targeting business owners when they are at their most vulnerable: when they need money. Here are some of the more prevalent scams and some tips at avoiding them.

One popular con is the "advance fee scam." Someone claiming to be a loan broker asks for an up-front processing fee that can be as high as $3,000. If you pay the fee, you will never hear from the fraudulent broker again.

But money is not the only thing these criminals are after; many scam artists are after your personal information. These phony brokers generally promise low rates or instant approvals to entice you to apply. With this application, they have your Social Security number, credit card numbers, and bank account information to use for their nefarious purposes.

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