November is here and South Texas consumers have started preparing for the holidays. The season is known for shopping, and as people travel to see family and attempt to find the perfect gifts for loved ones,it can be easy to find yourself strapped for cash around this time of year.

With so many spending opportunities, it might be tempting to take out a small loan to help ease some financial strain but be on the lookout for advance fee loan scams. If this is the first time you’re hearing of this kind of scam, it works like this:You receive communication (this could be a phone call, email, flyer or online ad) offering a great deal on a loan. They may even promise a guaranteed low interest rate or tell you you’ve qualified for a special program. The deal is, you must pay an upfront fee for processing or insurance. Once you pay the fee, the lender, and your money, disappear.

More than 100 advance fee loan scams were reported to BBB Scam Tracker across Texas in 2018, with claimed losses ranging from $25 to $7,000. This scam is also aimed at small businesses needing startup capital or funds to scale their operation. So, what can you do to keep yourself safe? Follow these tips from your Better Business Bureau:

  • Watch for vague fees. It is not uncommon to charge fees for loans. These can include application, appraisal and credit report fees. A legitimate lender will discuss those fees upfront and collect them from the money they lend you. A scammer may try to collect fees before you get the money.
  • Avoid guarantees and unusual payment methods. Trustworthy lenders won’t guarantee you a loan or certain interest rate before checking your credit score and other documents. They will also never ask you to pay through unusual or untraceable methods like wire transfer or gift card.
  • Do your research. Some scammers will pretend to be from legitimate agencies to gain your trust. Contact the agency directly to confirm the program is real. Lenders and loan brokers must also be registered in the state where they do business. You can check their registration by calling the Texas Attorney General’s office.

Enjoy a stress-free and financially responsible holiday from BBB!