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Online lending company broke the law. FTC counts the ways.

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If you need to borrow money to consolidate credit card debt, make home or auto repairs, or pay other unexpected bills, a personal installment loan may be an option.

Most personal loans are unsecured, meaning they don’t require collateral like a house or car, and typically have higher interest rates than secured loans.

Paying a higher interest rate is one thing, but when it came to one online lending company, customers were caught off guard by what the FTC says were lies and illegal conduct.

Today, the FTC announced a settlement with Avant, LLC, a company offering personal loans online. According to the FTC, Avant deceived customers in a bunch of ways about what and how they were supposed to pay. For example, the FTC alleges that Avant:

  • advertised that it would take payments by credit or debit cards when, in many cases, it wouldn't;
  • illegally required customers to agree to automatic payments from their bank accounts;
  • deceived customers about the amount needed to pay off their loans;
  • collected — or tried to collect — more money from people who paid the quoted payoff amount; and
  • made unauthorized charges on customers’ bank accounts.

The settlement bars Avant from engaging in similar conduct and requires it to pay $3.85 million to thousands of customers harmed by its loan servicing practices.

If you’re shopping for an online loan, do some research, especially if you’re not familiar with the company. Type the lender’s name into your favorite search engine with terms like “review,” “complaint” or “scam.” If you find bad reviews, you’ll have to decide if the offer is worth the risk. After all, it’s only a good deal if the loan and servicing experience lives up to the written promises.

If you think a company has violated the law, tell the FTC at ftc.gov/complaint.

For more information, check out our Credit and Loans page.

Tagged with: loan, online, unsecured
Blog Topics: 
Money & Credit

Comments

Go get all those crooks!!

Glad to see people like this have to take responsibility for their fraudulent behavior. I sure hope (but wouldn't hold my breath) that the victims of their scam get some of their money back...

The final settlement order requires the company to pay $3.85 million to thousands of customers harmed by its loan servicing practices.

Anyone getting any jail time? Or will it be the same as what happened w/Wells Fargo, GE (mortgages) and other investment banks--they pay a fine that is far less then their profits were and those who created the unfair/illegal/reckless policies are free to enjoy their ill got millions?

Avant, LLC agreed to settle charges with the FTC. The final order imposes a judgment of $3.85 million, which will be returned to consumers who were harmed by Avant’s unlawful practices.

Please read the press release for more information about the terms of the settlement order and what Avant is prohibited from doing.

I applied with Avant and was quoted 36% interest. That rate is criminal. It would have cost me 2500.00 dollars just in interest for a 3 year loan. No thanks lending practices like that should be jailed and closed for good,.

Thank you FTC for making all our lives a little bit safer and happier.

I applied for a loan online and later decided to opt out but couldn't.. now the money is in my bank.. how can I opt out without paying no interest rate? Apr was at 289 which is ridiculous..

As always thank you for your continued success in helping others. As I have gotten older it really helps me to stay informed.

I have a loan with Avant. How do I find out if I have been cheated by this company?

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