Chicago Residents Lose Thousands of Dollars to Phony Loan Scams Warns Better Business Bureau


CHICAGO – April , 2016 – The offers come every day, you’ve been pre-screened, pre-qualified, or pre-approved for a new credit card or a loan, just sign or click here. Sometimes when those offers come, either by mail, phone, or email…the recipients, may see it as an answer to their prayers. But the Better Business Bureau warns, those often unsolicited offers can do real harm to consumers.
 “If you  have you been turned down by a bank because of your poor credit history… you may be tempted by offers that guarantee loans or credit cards, regardless of your credit history,” says Steve J. Bernas, president and CEO of the Better Business Bureau serving Chicago and Northern Illinois. “Often out of a feeling of desperation individuals buy into these offers and find they’ve only compounded their problems.”
Chicago resident Diane Donley is a victim of a loan scam; “They called me and offered to help me get a loan modification from my lender. I don’t know where they got my name but I am on disability and really needed the help.  I sent them two checks that were supposed to be for escrow and they totaled $1574. My lender told me that they never got the money. And the loan company would not cooperate when I asked for a refund. I think I ended up on some kind of sucker’s list now because I get calls daily offering help with my mortgage.”
LaPortia Hosley, also of Chicago, is another victim; “I got an e-mail offering me a loan for $7000. I called them and they asked for money first for taxes and fees—they kept asking for more and the 6 MoneyGram’s that I sent added up to $1280. I paid a cancellation fee and should have my refund by now. I need the money to pay for my daughter’s funeral.”
“In both these cases there is a huge red flag – the advance payment – no legitimate lender will require an upfront payment to provide a loan. In fact doing so is against federal law and lenders know they can lose their registration or license if they request pre-payment.” notes Bernas.
He also states “The credit card offers can also put consumers at risk because some of them are scams. For example consumers with low credit scores are offered a credit card with no annual fees and up to a $2,500 limit. They pay a processing fee however, instead of the promised preapproved credit card, the consumer receives coupons and discount offers for various items or a stored-value card that requires a deposit. In other cases the credit cards can only be used to purchase items from a catalog issued by the credit card company.”
To avoid these loan and credit card scams, the BBB advises consumers to look for these red flags:
Guaranteed credit limits, as an issuer cannot guarantee a limit without your specific credit information
Near-term expiration date
Payment is required before receiving your loan or card
No contact information
Vague or misleading terms
Report the scam to BBB Scam Tracker at
Consumers can also protect themselves by opting out of pre-screened offers. That can be done for a five year period or permanently. To begin the process visit

or call 1-888-5-OPT-OUT (1-888-567-8688).
For more information on scams, visit,

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ABOUT BBB: For more than 100 years, Better Business Bureau has been helping people find businesses, brands and charities they can trust. In 2015, people turned to BBB more than 172 million times for BBB Business Reviews on more than 5.3 million businesses and Charity Reports on 11,000 charities, all available for free at The Council of Better Business Bureaus is the umbrella organization for the local, independent BBBs in the United States, Canada and Mexico, as well as home to its national programs on dispute resolution, advertising review, and industry self-regulation.