Every entrepreneur must be careful in trusting lenders or lending companies all the time. It is better to ensure your business’ safety than be sorry in the end simply because of believing dishonest people. You have to first research thoroughly about the company where you plan to borrow money and make sure everything is legitimate.
There are numerous lending companies out there that offer business owners a comprehensive funding service. However, it is your responsibility as an entrepreneur to know if these are licit or not. You must take your time in finding out if a certain company operates legitimately or is a credible one. Since there are a lot of business-related scams that are happening everywhere these days, you really need to be extra cautious and never give your trust easily to anyone.
Apparently, there are still reputable companies out there, like Kikka, which offer legit business finance services. All you have to do is to verify the company, check each information provided in their website, and meet them personally. More so, take a look at the following red flags of a business loan scam to avoid any fraudulent operations:
Up front fees
A sure fire way to know if a lending company is doing a fraudulent act is when its loan officers ask you for money in advance. A legitimate loan company won’t ask you for any fees up front before it sends you your initial loan. The only time a lender can ask you for cash or what they call a commission is after you have finalized the deal. Otherwise, you have to look for another lender that operate lawfully and orderly.
When you apply for a business loan, there is no guarantee that it will be approved. Nevertheless, if the lender offers you guaranteed loans even before receiving your application, then you are sure that this company is up to no good. Truth be told, there is no other way of getting approved on your loan application than to go through the entire legal process.
No physical address
The lack of a physical office address of a lender is one of the top and easy ways to determine if it is a legitimate one or not. It must have a real mailing address where you can meet personally the lender and talk about business one on one. In case it does not have one, then you can suppose that it is a scam and they are operating an illegal business somewhere else.
Negative online reviews
A quick research online and you can easily find out of a company has good or bad reputation. Just like the way you research for good hotels in TripAdvisor, you also have to read reviews for the lending firm. There will always be negative feedback from time to time, but if a bank or a firm gets negative review all the time, it is better to search for a better financial partner.
On the whole, as an entrepreneur, you have to make it a point to secure your business from any danger at all times. When you are in search of a funding service, you must not be vulnerable and gullible. Everything needs to have a proof as well as straight-up facts. Dealing with a deceptive loan company is the last thing you would want. Thus, you need to consider these helpful tips mentioned above to prevent getting ripped off and get a funding opportunity legitimately.