As the process of applying for loans involves divulging a considerable amount of your personal information, online fraudsters have realised that this is a good way of preying on their potential victims.
This may be why, when you first take to the internet in search for a loan, you are overwhelmed by the sheer amount of online lenders trying to win your business.
For this reason, it is vital that you are clued up on exactly what makes an online lender reputable and trustworthy. The following points are some of the basic requirements you should be on the look out for when browsing loan websites.
Consumer Credit Licence
Before a company can offer any kind of credit within the UK, they have to have been issued a "Consumer Credit Licence" or "CCL" by the Office of Fair Trading (OFT), the consumer credit watchdog.
This is a legal requirement for any company that wishes to offer you credit or pass your details onto a broker or lender.
When a company applies for a CCL, the OFT will check that it actually exists and that its directors are in a good enough position to conduct such business. The OFT will also run background checks on the directors to ensure they are who they say they are and have no criminal records.
Therefore, if a company displays a valid CCL on its website, then you can be happy in the knowledge that its credentials have been checked and approved by the OFT.
A CCL is 6 digit number, ie. 610526
Data Protection Act Registered
As mentioned above, when applying for secured loans you have to disclose a considerable amount of highly personal information. It is understandably important that you feel confident in trusting the company to whom you are sending your details.
This is achieved by the lending company being registered under the 1998 Data Protection Act.
The basic requirements of the Act are that any company or individual that holds your personal details must make certain they are handled, transmitted and stored in a secure and responsible way.
So, before you submit any of your personal information to a business its important you ensure that they are displaying a valid data protection licence.
A Data Protection Licence is usually 8 alpha numeric characters, ie. B922588X
Valid & Confirmed UK Address
The competitive nature and ever increasing demand for credit within the UK often attracts foreign fraudsters, and as a result, many online loan sites are not operated by UK-based companies or individuals.
As we have already identified, the details you are required to supply when applying for secured loans are highly personal, and provide all the information necessary for a fraudster to steal your identity.
To make sure that the website you are viewing is backed by a genuine UK company or individual, take a few minutes to look around the site to see if you can find a UK address and telephone number. Such information is usually found in "About Us" or "Contact Us" sections.
If you have any doubts about the validity of the lenders contact details seek guidance from an IFA or the Citizens Advice Bureau before proceeding.
In summary, ensuring that a company has fulfilled all of the above basic requirements should prove that it is a trustworthy secured loans lender, who will handle your personal information and loan application in a safe and acceptable manner.
