The FBI has received reports of payday loan scams and are investigating the matter. Bankruptcy attorneys can talk with recipients of payday loans who may be defrauded by these callers.
According to the Associated Press, the Federal Bureau of Investigation has reported that some payday loan recipients have received threatening calls by callers fraudulently claiming to be lawyers, the FBI, and other agencies. These fraudulent callers threaten the debtors with legal consequences and demand repayments of the payday loans. The recipients of the payday loans mistakenly believe that the calls are coming from payday loan employees who are zealously calling them while harassing them. Unfortunately, some payday loan recipients have received threatening calls from creditors in the past and so the aggressive tone of these payday loan scam callers sounds similar to legitimate collection agencies attempting to collect on their debts.
Payday loan lenders lend short-term loans to borrowers who may use the small loans to cover living expenses in between paydays. However, the interest rates can be very high, making it very difficult for the borrowers to repay the loans. In fact, some payday loan recipients end up taking out additional payday loans just to pay back their original payday loans. At times, however, payday loan recipients opt to file bankruptcy through the assistance of an attorney in an effort to eliminate their debts if they find after several months that they cannot afford the payment or if they feel they can no longer tolerate the collection calls.
The payday loan scam callers have been able to gather accurate information about the borrowers of the payday loans. They use this information to repeatedly call the borrowers at their homes and threaten them with arrest. The FBI has asked that recipients of payday loans should notify their local banks, credit bureaus, and local law enforcement agencies. However, one of the most direct remedies to avoid payday loan scams is to simply file bankruptcy on the creditors.
Bankruptcy attorneys can help debtors eliminate debt through Chapter 7 and Chapter 13 bankruptcy filings. Once debtors file bankruptcy, they are given a bankruptcy case number and federal law prohibits creditors, including payday loan companies, from calling to collect money. The filings also stop all collection activities, including garnishments and lawsuits. A Chapter 7 bankruptcy, also known as a liquidation, enables debtors to wipe out debts and the procedure typically is finished within a few months. In contrast, a Chapter 13 bankruptcy, also known as a payment plan, enables debtors to make monthly payments to the bankruptcy court who then pays out creditors over a 3 to 5 year period.
If you are receiving harassing creditor calls, including from payday loan companies, make sure that your rights are not being violated or that you are being scammed by contacting us at bankruptcy lawyer. This article, Payday Loan Scams Under Investigation by the FBI is available for free reprint.
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Tags: Bankruptcy, bankruptcy attorney, bankruptcy lawyer, lawyer, loan, payday loan