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I received a check in the mail made out to me. should I charge it?
not necessarily. Be sure to read all the fine print to determine if the check is a refund from a trusted agency like the Internal Revenue Service or is a regular “living check loan.”
What is a living check loan?
A live check loan is a loan offer sent by lending agencies to pre-approved borrowers offering a small loan, usually $500 to $2,500, usually at very high interest rates, often above 25 % of April. This loan offer will include a check made out to you ready to cash. Live check loans must also include: a disclosure of the loan fees, the annual percentage rate (APR), the payment schedule, the loan agreement, a privacy notice about the sharing of your personal information, your right to exclude your name from future offers – called an opt-out notice and contact information for the sender. By cashing or depositing the check, you agree to all terms and conditions attached to the loan. Be sure to read the fine print included with this check to determine if this loan is right for you.
Is this pre-approved loan offer a scam?
Scammers sometimes send bogus loan offers by mail, email, or text message. These may look very similar to real live check loan offers, but they are used to obtain your personal or financial information to commit identity theft or fraud. If the loan asks you to send money, personal or financial information in return, it is most likely a scam. Visit the Consumer Financial Protection Bureau’s consumer complaint database to see if the lender is licensed in your state and if there are any complaints against them at https://www.consumerfinance.gov/data- research/consumer-complaints/ If you think this offer is a scam, you can report it to the federal trade commission at https://reportfraud.ftc.gov/#/
How does a live verification work?
If you wish to accept the loan by live check, you must endorse the check by signing the back of the check and cashing or depositing the funds into your bank account. This creates a loan contract that you must repay with interest according to the included payment plan. If you pay late or don’t pay, you may be charged fees along with interest, and the lender may report your debt to a credit reporting agency, which could affect your credit score. To decline the loan offer, you must securely destroy (shred and dispose of) the live check to prevent possible fraudulent use by others.
How do I determine if I should accept this loan offer?
Live check loans can be convenient since you don’t have to fill out a loan application or submit paperwork. however, living check loans can have much higher interest rates than other loans or credit cards. If you are interested in a loan or line of credit, you must follow these simple steps:
- Research the lender. Check to see if the lender is licensed to do business in your state through your state banking regulator. check the consumer financial protection bureau’s complaint database to see if the lender has any complaints.
- read the loan agreement. Understanding loan rates and terms helps determine affordability. the agreement must detail the total annual cost of the loans, represented as an annual percentage rate and including interest costs and fees; the number of payments required; and payment amounts.
- check. Compare personal loan rates and terms at credit unions, banks and online lenders. If you have bad credit, you may be able to get lower rates at federal credit unions, which cap loan rates at 18 percent. You can also check rates and terms at online lenders. most do a soft pull on your credit, which has no impact on your credit score.
- focus on long-term solutions. Create a budget that tracks your spending, which can identify unnecessary spending and help you pay off debt or send money to an emergency fund. then you can use cash for emergencies instead of high-interest credit.
What should I do with this live verification?
If you decide you want to accept the loan offer, simply endorse the back of the check with your signature and cash or deposit the check into your bank account.
If you decide you don’t want to accept the loan offer, tear up the check and throw it away. If you don’t destroy the check before throwing it away, you risk someone cashing the check in your name and becoming liable for a loan you didn’t receive.
How do I stop these unsolicited loan offers?
If you don’t want to receive actual checks or other unsolicited loan offers, you have the right under the Fair Credit Reporting Act to opt out of future offers for five years or permanently. To opt out for five years, call 1-888-5-optout (1-888-567-8688) or visit https://www.optoutprescreen.com/?rf=t To permanently opt out, visit https://www.optoutprescreen.com/?rf=t and return a signed “Permanent Opt-Out Form” which will be sent to you after you make your request .
I already cashed the check. what do I do now?
By cashing the check, you became bound by the terms and conditions of the loan offer. If you can’t afford the payments as outlined in the offer, contact the lender about possible options for repaying your loan. If you pay late or don’t pay without reaching an agreement with the lender, you may be charged fees along with interest, report your debt to a credit reporting agency, or take action to garnish your wages or property.