5% Loan without application fee - SCAM or not?
Hi Everyone,
I was recently responding to a post on a meetup group "New York Real Estate Entrepreneurs" about a private loan with 5% interest. This guy, his name is Michael, said he could loan me $200K with 25years term @ 5%. It is too good to be true. We only communicated via email. And he is using a personal gmail michaeltreatloanservice. It seems unprofessional. I couldn't search him at google. He didn't ask me to pay any application fee in advance. He just sent me the application form to fill out. The application form asked for my compete name, address, DOB, Mother's maiden name, DL/ID #, and signature. Is this common for a personal private lender? Or he tried to scam me for identity theft?
I want to thank you for your input in advance.
Originally posted by @Johan Yang:Hi Everyone,
I was recently responding to a post on a meetup group "New York Real Estate Entrepreneurs" about a private loan with 5% interest. This guy, his name is Michael, said he could loan me $200K with 25years term @ 5%. It is too good to be true. We only communicated via email. And he is using a personal gmail michaeltreatloanservice. It seems unprofessional. I couldn't search him at google. He didn't ask me to pay any application fee in advance. He just sent me the application form to fill out. The application form asked for my compete name, address, DOB, Mother's maiden name, DL/ID #, and signature. Is this common for a personal private lender? Or he tried to scam me for identity theft?
I want to thank you for your input in advance.
THEORETICALLY I was originally going to say he could just be a commercial mortgage broker.
But mom's maiden name and state DL/ID# number? Nah, in fact I'm going to go ahead and say more than likely he's personally never even gotten a mortgage...
- Mom's maiden name seems like something from a college admissions student aid form or similar.
- Also no reason for a mortgage broker to ask for a DL/ID#, since we need an actual copy of it to comply with the PATRIOT Act.
What can I do with DL/ID# (just the #, not the ID) and mom's maiden name? Absolutely nothing, so there's no reason for me to ever ask.
So, yeah, pretty clearly some form of scam.
Legitimate lenders don't use gmail accounts.
They don't offer 5% loans for 25 years.
He didn't ask you to pay any application fee, YET. He will.
This is a scam.
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5% APR is too good to be true from private lender.
Normally, the private lender will look at the deal first. Most of the private lenders are NOT credit based and deal based. They see that you have down payment, comps to support, market value, renovation costs etc...
Then start with other documents as needed.
Be cautious. The next step; they may start asking for substantial upfront money. Then it most likely a SCAM.
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#2 All Forums Contributor
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@Johan Yang
Of course it’s a scam. There is no 5% money. End of that discussion
Only way would be family giving u a break no one u don’t know
@Chris Mason @Mindy Jensen @Saravanan Saravanan @Jay Hinrichs thank you so much for your inputs.
@Johan Yang it’s about as legitimate your car offering to loan you money
Definitely a scam. Private lenders don’t do 5% loans for 25 years and they don’t need your mother’s maiden name. Scammers do though.
@Johan Yang Everyone here seems so pessimistic. I wouldn't necessarily jump to the conclusion that it's a scam but I wouldnt give any information until I was able to verify that this guy, his company is 100% legit. That should be easy enough. Here in Texas it is quite common to see regular Yahoo and gmail accounts in the real estate business.
Dont jump to conclusions but be careful!! Good luck!!
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Originally posted by @Charles Long:
@Johan Yang Everyone here seems so pessimistic. I wouldn't necessarily jump to the conclusion that it's a scam but I wouldnt give any information until I was able to verify that this guy, his company is 100% legit. That should be easy enough. Here in Texas it is quite common to see regular Yahoo and gmail accounts in the real estate business.
Dont jump to conclusions but be careful!! Good luck!!
e mail as you said is not the dead give away.. My wife still uses AOL and one of the bigger rehab builders in PDX still uses AOL. that just shows we are older folks.
the scam is basically and again like everyone has mentioned there is NO 5% private money NONE .. only people that will do that will be your direct friends or relatives that are cutting you a break etc. Not anyone on the internet..
Prime rate is 5.5% right now.. and most private firms that re lend money get their money at 1 over prime. Just like I did when I ran a fairly larger HML shop.. So just stating reality of the lending world.. :)
@Johan Yang Mother's maiden name is a red flag, as well as the driver's license number. Once he gets your social security number, he can probably use your mothers maiden name as your security word for other accounts??
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@Charles Long@Jay Hinrichs @Stephanie Medellin Thank you so much. I have decided to not go ahead with him and not fill out the form.
@Johan Yang,
Definitely this is a Pure Scam stay far away,they have not asked you for any upfront fee does not mean that they won't ask. After the Application form,you will receive an approval letter and there you will see the fee pop up lol. Trust me stay away and stop every communication. If you need help with a Loan,there several legitimate Lenders here to assist you.
Posting to discussions on local investor meetups as:
Michael Larry Treat
michaeltreatloanservice
This guy posted in Indianapolis also so it looks like he is posting all over. Might be fishy. Google searches pulled up this chat but nothing else. Anyone actually fill out an application?
Originally posted by @Mindy Jensen:
Legitimate lenders don't use gmail accounts.
They don't offer 5% loans for 25 years.
He didn't ask you to pay any application fee, YET. He will.
This is a scam.
They also use last names! LOL
@Austin Ojimgba @Mike D'Arrigo @Account Closed I am curious as well if anyone has actually done it. I did not do it.
The only lenders doing anything close to 5% are on long term rental products. Like 15 30 years or so. You can get close to 5 but generally closer to 7%.
There are some legit lenders like COGO and Groundfloor who charge minimal application fees but mainly to discourage tirekickers because they do have a cost associated with processing loans. $199.00 for the most part.
Other than it's probably a scam.
This guy Michael also hit a meetup in the SF BayArea with his offer about 7 months ago, I reached out to him at that time just to keep as an option, followed up with him recently and he responded pretty quickly. But the whole scenario did not sit well with him, I wasn't planning to give any info until verifying him and meeting in person, when I did an online search for the email address I found this thread, so it pretty much verifies that it's a scam. I'll see how far our communication will go, curious how he will respond to a request for an in person meeting.
