Now if there is a consumer finance warning in PC World, you know something has got to be afoul. In an article titled Consumer Alert: Questionable Online Lenders Demanding Upfront Fees, PC World investigates what can best be defined as unscrupulous lending practices by a San Jose, California-based mortgage lender named MortgageTree. The article cites several questionable practices including some sort of nutty fee scheme where the company is apparently “asking its customers to wire money to Canada to cover miscellaneous loan and finance charges”. The targets appear to be cash-strapped, financially troubled borrowers who wind up getting a lot more than they bargained for when they arrange an online loan with MortgageTree.

The article profiles one borrower in particular, a Lekiesa Willis of Hope, Arkansas. The exchange allegedly went down like this

Willis found Mortgage Tree Lending in September when she typed in the questions “Where do I get a $5000 personal loan with bad credit?” into the Ask.com search engine. She followed a link in the search results and was taken to a site that prompted her to provide an e-mail address and phone number. The next day Willis says she received a phone call from MortgageTree Lending asking her to fill out a formal loan application and fax it back.

At first she was told to wire $950 as an “insurance premium” and she would get that money back. Days after Willis wired the money, a MortgageTree Lending representative asked her to wire an additional $680 in taxes and fees. She wired the money and waited, and waited.

The fact is that there is a lot of this going on online, particularly in the wake of the subprime meltdown. If you are considering borrowing from this company read the full article at PC World.

Tags | borrowers, consumer finance, fee scheme, finance, finance charges, insurance, lenders, loan application, mail, money, mortgage lender, mortgagetree lending, personal loan, personal loan with bad credit, questionable practices