Monday’s blog warned of the dangers of swimming with Virginia’s payday and car title lenders.  Today we want to warn you about other dangerous predators trying to lure Virginians with promises of “Fast Cash” and “No credit/no problem” loans.  Believe it or not, these lenders are even worse than payday and car title lenders.  Here are two that you should be extremely wary of:

• Line of Credit loans  

• • These are former payday lenders that dropped their license to do payday loans because they want to do things to their borrowers that are prohibited under Virginia payday loan laws; they make loans to people who already have other outstanding loans, get borrowers trapped in loans that are designed to never end, get automatic debits of borrower’s bank accounts and use any means they choose to harass borrowers that inevitably fall behind. See Loophole in Credit Law Opens Door to 360 Percent Interest Rate

• Online lending

• • This is illegal in Virginia but little or nothing has been done to stop it.  However, the Virginia Poverty Law Center has teamed up with several private attorneys to try and put a stop to this.  Online loans will not only take a bite out of your finances but it will lead to sharks feasting on your privacy and your sanity (with seemingly endless abusive collection calls from scammers and collectors who have bought or stolen your personal information).

The bottom line: Stay out of the water when it comes to these types of loans!