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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,.

I used advent. What can I do. My interest rate was over 30 percent. I know I definitely overpaid.

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

Light Stream and Prosper on line lending companies does the same thing Avant Co, does. They make you pay a higher interest than expected. and you have to agree to automatic payments from bank accounts. My credit score was over 700. I was told the rate was to be 5.6 percent but turned out to be 11%. They also charged over a thousand dollars for the loan.

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..

Take the money that they deposited and pay off the full loan!

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?

It's great that you are going after horrible practices. Some of the reasons that you got this company is the same way student loan companies act. They make it difficult to set up automatic payments, to change it to higher amounts, at one point I set mine up for an increased amount and assumed that it would be taken care off since they made me fax in an automatic withdraw form. Few months later I check my account and they didn't withdraw for three months and didn't send me a pay notice because I had "credit" but ended up charging me my daily interest. That's when I said enough and used my savings to pay it off. This was with Fedloan.

Please check out CashNetUSA they are doing the same thing thank you.

You should check out MAXLEND ..they did all that to me.

How is the settlement paid out to customers, since everyone that applied with loan wasn't given a choice on how they could pay the loan back.

I have a loan with Avant.......at the time of the loan, I was told I had to pay back the loan with automatic deductions from my bank account. Does this mean I was deceived? That I really didn't have to do that like the FTC says?

Should I keep paying on this Avant loan (supposedly only 2 more payments) or stop until I know if they have to pay back money?

The company sounds hurtful. I just feel glad not to have been part of this scamming. If I needed to get a loan from anywhere I would consider the risks and make sure I felt confident I knew what to do if this happened to me. Thanks for keeping me informed.

I pray they go after Lending Club they quoted me one interest fee for a loan and after I was approve they sent paperwork for me to sign they increased the rate by 10% and charge me an astronomical fee for the processing, $800 to be exact. Also One Main Financial. They told us they have very good interest rates, when we applied they called us to come in and sign and we got there and Victoria had the paperwork ready for a signature and then indicated the interest rate is 35.99% and attempted to charge us a processing fee if we failed to sign. She lied about the payment, they overdraft my account by taking payments on dates that was not agreed upon. This is ridiculous, isn't it illegal for them to do this to people.

Thanks. Ftc for helping the consumer

For FTC

when will we find out how consumers affected by Avants practices can recoup the money set aside in this settlement?

Who is the Settlement Administrator?

When and how will this information be conveyed to consumers?

Thanks

Right now, we know that the FTC will use the defendants’ business records to identify people who were affected.You don’t need to contact the FTC to file a claim or ask for repayment.

I have a loan with AVANT and my APR is 39% I didn't know, they try to take $ 3,000 more in additional of $ 5,000 loan which I borrow, I made already 2 payments. I'm intending to pay off this loan ASAP. This is rip off

For FTC Who is the settlement administrator?

The FTC will use the defendants’ business records to identify people who were affected.You don’t need to contact the FTC to file a claim or ask for repayment.

Why do people scam others anyway, just get a job like the rest of us.

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