Don't fall for eviction moratorium aid scams BBB warns

With millions in the United States behind on their rent, the moratorium’s end is a perfect hook.

How the Scam Works
As the eviction moratorium winds down, watch out for scammers offering loans, peddling credit repair services or promoting government programs. These cons are a way to trick desperate people out of money they don’t have.

For example, during the COVID-19 pandemic, BBB Scam Tracker has seen numerous reports of phony “pandemic relief” grants or government programs that allegedly provide funding to people impacted by the pandemic. Once you “qualify for the grant,” the scammer will ask you to pay a processing or delivery fee to receive your funds. Of course, the grant doesn’t exist, and if you pay upfront, you just gave money to scammers.

Advance fee loans, debt relief and credit repair scams work in a similar way. They promise a loan—or to repair your credit—for an upfront fee. No matter how much you may need it, don’t be tempted by “guaranteed loans” or impossible services, such as removing late payments or a bankruptcy, from your credit report.

This recent BBB Scam Tracker report describes a situation more people will likely encounter as the eviction moratorium nears. “I'd been in a desperate financial situation for a few weeks now, so I had been looking for loans and being denied left and right,” the scam victim told BBB. The victim received a call from a loan provider, saying their loan application had finally been accepted. There was just one catch: before the company could release the money, the borrower had to increase their credit score. Fortunately, this company had a way to help. “The way they would do that is they would send money to my account and then all I would have to do is send it back and that would boost my score.” Of course, the scammers never actually transferred the money. When the victim “sent back” the funds, they transferred $1,000 into the hands of scammers and overdrew their account.

Protect yourself from this scam:

• Double check any government program before you sign up. If an organization is offering you a grant or relief funds, get to know them before you agree to anything. Take a close look at the website and read reviews. If you think you might be dealing with an impostor, find the official contact information and call the company to make sure the offer is legitimate.
• Be wary of out-of-the-blue calls, emails or text message claiming to be from the government. In general, the government will not contact you using these methods, unless you granted permission.
• Do not pay any money for a “free” government grant or program. It is not really free if there is a fee involved. A real government agency will not ask for an advanced processing fee. Instead, find out if the grant is legitimate by checking grants.gov.
• Advance fees are a concern. Not all businesses promising to help you repair bad credit are scams, but if you are asked to pay in advance, that’s a big red flag. In both the U.S. and Canada, credit repair and debt relief companies can only collect their fee after they perform the services promised.
• Avoid guarantees and unusual payment methods. Real lenders never guarantee a loan in advance. They will check your credit score and other documents before providing an interest rate and/or loan amount and will not ask you to pay an upfront fee. Fees are never paid via gift cards, CashApp, or prepaid debit card. Unusual payment methods and payments to an individual are a big tipoff.

For more information: Get further insight by reading BBB’s tip on loans and credit repair services. Learn more about government impostor scams during COVID-19.

If you’ve been the victim of a similar scam, report it to BBB Scam Tracker. Your firsthand experience can help others recognize scammers’ tactics before it’s too late!