The internet has always been awash with companies offering promises of loans - and
when times were good most of these were able to backup this commitment with the hard cash - i.e you applied and they would find you a loan.
But times have changed and the loans that were available before are no longer there. So where does this leave the websites?
Well many have closed down - they were traditionally paid commission from the lenders so if there were fewer loans and fewer lenders there would be less commission.
However, in their place is a new breed of website that offers the same promise of a loan. But this time there is a twist. Many of these charge a fee to take an application from you. This way they can cover their costs without necessarily needing to generate commission from loan completions. But the loan is far from guaranteed.
This leaves many customers with a hole in their wallet but no loan. And with the typical fee being somewhere between 50 and 75 we are not talking pennies.
So what should you do?
We in the first place DO NOT PAY up front fees. If the company are that sure that you will be able to get you a loan they will not have to charge.
If you have been charged a fee you are entitled to your money back (minus a small admin fee) by law if the loan does not complete. This may not be easy - you will have to persevere. You may need to involve your local Trading Standards department but this is what is needed to stop this unscrupulous business.
Even if you did get a loan the fee should have been included within the credit agreement and would be reflected in the APR.
There are options available for customers finding it difficult to get a loan. Guarantor Loans allow you to enlist the help of a homeowner to back your application. Whilst log book loans can use value you have in your car to secure the loan.
But there should be no need to pay an up front fee.