On September 11 I applied for a loan via the website. The company I applied through is called Safeway Lending Group and their web address is www.safewaylendinggroup.net This website claims they are a "second chance" lender that specializes in people who have had previous credit problems and cannot obtain "traditional" loans through"mainstream" lending institutions.
On September 15 I recieved a call from Grace Allen (888-360-9572 extension 300) who informed me that my loan had been approved and all I needed to do to obtain my loan ($10,000.00USD) was to send in a copy of my Drivers License, Social Security Card, my most current paystub, and a Collateral Payment of $1,550.00. Now the first three items she asked for I pretty much expected and given the amount of Identity Theft going on today, these are probably the very least any bank should ask for before opening up a new account or loan product. But it was the last requirement (the $1,550.00 Collateral Payment) that really threw me for a loop!
When I asked her about this requirement, she said that the bank holds on to that fee for six months. She stated that this fee is only used in the event that I not make my monthly payments or otherwise default on my loan in some way. She also stated that after six months of on time payments (this meaning that none of your payments can't even be an hour late, since your payments have to be recieved and credited to your account no later than 3:00pm on the due date) they will cherfully return that fee to you in the form of a certified check.
When I asked Grace Allen if she could provide me with a physical street address to where I could FedEx her company the Collateral Fee, she informed me the only way in which I could make that payment was in the form of guaranteed funds. I informed her that was fine, and that I would go down tommorrow to my Credit Union and have them issue me a Cashiers' Check made payable to Safeway Lending Group. Well Grace said this was NOT acceptable. She said that even Cashiers' Checks can have a "stop payment" placed on them, and because of this they are not considered guaranteed funds and therefore under the terms of my loan, Safeway Lending Group cannot and will not accept it as payment for my Collateral Fee or as any type of payment on my account (s) should I choose to open an account.
So I asked Grace what her companies' version of guaranteed funds were and she said that Safeway Lending Group will only accept MoneyGram as a form of payment, period (made payable to a Tiffany Lorde, who according to Grace is the companies' head financial person and since she handles all the monitary transactions for the company, it's her I have to send the MoneyGram to... It's just easier that way, said Grace). Period, I asked?
She stated that even after the loan is funded, each moth on or before my sceduled payment due date, I have to send in my payments (s) via MoneyGram. She stated that if I attempted to send in a payment on my loan in any other form, other than MoneyGram, that I would be in default of my loan and recieve a Late Fee. And she said, if this should just so happen to be within the first six months of my loan contract, I would not be eligable to recieve my Collateral Fee back until the end of my loan (after the loan has been paid in full and a full 45 days has passed from the loan close date to ensure no returned items are going to come through and post to my account).
With all these restrictions and just the general "creeped out" feeling I got from talking with Grace, I decided to ask for some verification information regarding Safeway Lending Group just so I could calm my own nerves and also make sure that everything was on the up and up with this company.
I informed Grace that I was not comfortable sending that amount of money, or any amount of money for that matter, to a private individual, whom I don't know personally, and know even less about from a professional standpoint. Grace once again reinerated the whole "she's our head finance person" story. At that time I informed Grace that I wanted to take some time to think all of this out as well as check out Safeway Lending Group. She asked me what kinds of things I would be checking out because she could save me alot of time and energy by providing me with answers to my questions herself, If she had them, she said. I told her that was quite all right and that I would be getting back to her within the next 2-3 days.
I was going to start immediately on my verification quest for Safeway Financial Group, but got wrapped on an unreated phone call. After that call I had sat down and was just about to start my search for their Business
License (s) and Financial Profile (s), when my phone rang. When I answered my phone, the caller identified himself as Micheal Spencer. Micheal stated that he was part of the "credit committee" that reviews and decisions all of the applications and requests for credit for Safeway. Micheal said that he was very sorry, but after the "credit committee" completed the final review of my application for a personal loan, they felt my debt to income ratio was to excessive and did not meet their underwriting requirements (my net monthly income is $6919.35 and my mothly expenses total $2872.17, leaving me with an extra $4047.18 free and clear each month... Go figure).
I asked Micheal why Grace had called and informed me that I was approved when in fact I was actually never approved at all. Micheal stated that whenever an application for credit is recieved, it is immediately reviewed by a credit analyst. That credit analyst makes a tenative decision on the application and then fowards it to a Loan Officer, who then contacts the customer to give them the terms and conditions of their loan (if approved or if not approved, the credit analyst will call the aplicant and inform them of the primary reason (s) for denial). This person also requests any additional information and/or documentation needed for final loan approval.
He said it is the companies' policy that any approval given by the credit analyst is subject to the final approval of the "credit committee". Micheal said that appox. 98% of the time, the committee will agree with the original credit analysts' decision. But there are occassions, such as this one, where they don't always agree.
Micheal said that since I didn't meet the underwriting guidelines for approval at this time, I could just shred all documentation that I recieved from them and now I don't have to "waste my day today" checking them out on the web since my application was declined. Hmmm, how conveinant!!! But guess what Micheal? I checked you guys out anyways!
Their business is listed in the State of Michigan. I was unable to locate a Business License for that company anywhere in Michigan. I even checked the DBA Files. I contaced the Better Business Bereau for the Greater Detroit Michigan area, and they said they have never even heard of them. However they did inform me that if I wanted to verify their validity, since they were a financial services based operations group, I could call the State of Michigan Department of Consumer Affairs.
According to the BBB, every business who perfoms any kind of financial service to a paying customer base, has to hold a valid financial transactions license with the state. Well guess what? When I called up and gave the Consumer Affairs people this companies' information, the lady told me they had a license that was revoked in 12 for Fraudulent Lending Practices.
She said since that time, this company is sorta running like "fly by night" if you will. She said they frequently changes their name, their location, their phone numbers and even their sales pitch. Marjorie Jackson, the lady I spoke with from the Consumer Affairs dept. Said they are currently being investigated and have over 57 complaints filed against them from just this year alone. All the complaints are for Fraudulent Lending Violations i. E: approving an applicant, taking their Collateral Fee and skipping town, never to be heard from again.
Fortunately I got lucky before I was ripped off by this company. But alot of people was not as fortunate. ALWAYS contact your states version of the Consumer Affairs Department and check up on perspective companies. Verify their licensure and check with the Better Business Bereau for any information they might have. If they will provide it, obtain their DUNS Number (this is their Dunn & Bradstreet Number. This number is the Business equivelent of a credit report. For a small fee, you can view that business' credit history to see if they are someone you want to do business with).
I sincerely hope that by me writing this article, I was able to help someone, answer someone's question or even saved someone from making a huge financial mistake!
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