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Understanding Credit and Loans

Understanding Credit and Loans

Individuals spend their life creating and building their credit. Having good credit allows for purchasing and loan opportunities. Protecting your credit is just as important as building your credit score. To fall victim of credit fraud or loan fraud could set back an individual's credit for years. Being aware and knowledgeable about the situations you use your credit card in or when applying for loans will help keep your credit safe. 
Credit card fraud is a common practice by people who are looking to steal from others. There are many ways credit card fraud is done. Counterfeiting cards, lost or stolen cards, identity theft, no-card and non-receipt are the five most common ways of credit card fraud. 
Counterfeiting cards has the highest rate of credit card fraud. This is when information is taken off of the magnetic strip and other security features such as the holograms are reproduced. Fake card readers are sometimes placed over real credit card readers and the salesperson will swipe and steal your information at the same time, right in front of you.
Having a card stolen, or even losing it, could result in credit fraud. Cards are taken from common places such as, the workplace, gym or an unattended car. Keeping your card in possession at all time will eliminate this risk.
However, even if you have your card in your hand, your card is still at risk. Giving your card number over the phone to a stranger or online could result in fraud. All someone needs to have is your card number and expiration date. 
If a new or replaced card is in the mail, these could be stole as well. This is called non-receipt fraud. There is no paperwork that you received the card or that it had been shipped. Card companies have put activation processes in place to prevent this. 
Identification theft is when somebody applies for a card using another person's information. This takes a lot of digging and time to get the necessary documents. This gives the criminal full access to all the victim's finances. A victim would have a harder time finding this fraud, which also makes it the most difficult to correct. 
Not only can your credit be affected by credit card fraud, but also loan fraud. When getting a loan, one needs to research where the loan is coming from to find the credibility. Buying or leasing a home is where one needs to be aware of these traps. 
Lenders, appraisers, mortgage brokers and home improvement contractors could all be sources for loan fraud. They find clients through newspaper and online advertisements, fake websites and telemarketing. When these fraudulent businesses receive interest, they take it to the next level. Clients are told this may be there only chance at a loan. Housing prices also can be listed more than the other houses around, or at the closing, the price is different than the one agreed upon. 
Other tactics of brokers and agents are: creating fake appraisals, encouraging borrowers to lie on loan applications, lending more money than the borrowers could afford and placing higher interest rates based on race and ethnicity. 
Buyers beware: if a deal looks to good to be true, it most likely is. Become aware of these traps and read documents carefully and do your own research.

What Are The Overpayment Schemes

What Are The Overpayment Schemes

Overpayment at first may seem like a good reward for hard work or a great sell. However, the case is quite the contrary. Many people have been conned into an overpayment scheme where they end up losing their money, rather than making a profit. These schemes usually prey on the weak minded and those looking to make some fast money. 

With the invention of the Internet, there are a lot of online transactions. People buy and sell items on Ebay everyday. Selling and purchasing products from online site comes with some hazards as to how reliable sources are. 

When selling a product on Ebay, just like in a newspaper classified section, you rarely ever meet your buyer face to face. This causes for much concern and sometimes fraudulent activity. When selling products to strangers, a deal may happen smoothly, or their can be people that have schemes to get your product and your money. 

A buyer creates an excuse to write a check for more than the selling price. Then they instruct the seller to wire them back the extra money. The check the buyer sends bounces and the seller is then liable for the total amount of the check. 

Assuming the check will process can cause headaches and a loss of money. It takes time for the bank to be notified whether or not a check is valid or will bounce. Also, be aware if the buyer asks to use an escrow service that you are unfamiliar with or is outside the country. You can always refuse that service, or even the sale. 

There are several ways to avoid these schemes. 

         Know who you are dealing with. Ask for their information: name, address and phone number. The more information you have on your buyer the less likely they will be trying to scam you. If they do not give you this information, do not sell to them. 

         Do not accept a check for more than the selling price. Although it will be tempting to receive more money than you asked for, it is a good sign that you are in scam. Refuse the overpayment and only deal with the selling price.

         Come up with an appropriate payment method. If you do not like the escrow service the buyer insists on, bring up another one. Even change methods and accept a personal check, or cash, depending on the product. 

         If a wire transfer is part of the deal, refuse. If the buyer only will do the deal with you wiring them money back to an account, it is a clear sign that something is shady. 

         Do not be pressured into acting quickly. If the buyer is urging you to make the transfer quickly, or sell them the product quicker than you are willing, they might be up to something. Take your time with the sell.

There are many other situations that may arise when making a sale online or through a newspaper's classified section such as: being contacted to receive a prize or gift if you sell to a certain buyer, or even when checking try to have it done through a local bank. Be aware of who you are dealing with when making a sale to avoid an overpayment scheme. Having more information and resources will never hurt.