When you’re in a tight spot financially, a short term loan can seem like a lifeline. But not all lenders are created equal. Some are in the business of helping, while others are out to exploit. In Aotearoa, there are strong consumer protections in place, but that doesn’t mean every lender plays by the rules.
Dodgy lenders still operate—often online—and they tend to target those in vulnerable financial situations. So how do you avoid falling into their trap? In this blog, we’ll walk you through the red flags to watch out for and explain how a reputable loan broker like Loan Direct ensures you’re treated fairly.
Red Flag #1: They Pressure You to Act Fast—Too Fast
While fast service is great (we offer approval in 1–2 hours* ourselves!), dodgy lenders will often pressure you to commit immediately—without giving you time to read the terms or ask questions. High-pressure tactics like “you must decide now or lose the deal” are designed to keep you from thinking things through.
At Loan Direct, we move quickly but never at the expense of transparency. Our process is 100% online, simple, and you’ll always know exactly what you’re agreeing to before signing anything.
Red Flag #2: Their Interest Rates Are Vague or Sky-High
A trustworthy lender is upfront about interest rates and fees. If you can’t find a clear explanation of the total cost of borrowing—or worse, if you’re charged hidden fees down the line—that’s a major red flag.
Loan Direct offers secured loans from 9.95%* and unsecured loans from 11.95%*. We work with a network of reputable, low-cost lenders to find you the best possible deal. Transparency is part of our DNA.
Red Flag #3: No Credit Check or Assessment of Your Ability to Repay
This one might sound appealing—especially if you’ve had credit troubles in the past—but beware. Lenders who don’t care about your ability to repay aren’t doing you a favour; they’re setting you up to fail. They make their money from defaults and late fees.
Loan Direct believes in second chances—but with responsibility. We consider your whole financial situation and only connect you with loan options that set you up for success. Bad credit isn’t a deal breaker, but we won’t push you into something you can’t afford.
Red Flag #4: The Lender Isn’t Registered or Regulated
Every legitimate lender in New Zealand must be registered on the Financial Service Providers Register (FSPR) and adhere to the rules set by the Commerce Commission and the Credit Contracts and Consumer Finance Act (CCCFA). If you can’t find a lender listed on the FSPR or they don’t provide their registration number, steer clear.
In addition to being registered as a Financial Service Provider, Loan Direct is an associate member of the Financial Services Federation (FSF)—a trusted body that promotes responsible lending standards. As FSF members, we must act in your best interests when giving advice. It’s one more reason why you can trust us.
Red Flag #5: No Real Contact Information
If you can’t speak to a real person, that’s a serious warning sign. Many dodgy lenders avoid giving physical addresses or phone numbers. If all you can find is an anonymous web form with no contact information, be cautious.
With Loan Direct, you’ll deal with real, experienced loan consultants—people who take the time to understand your needs. We’re here to help, not just to process transactions. You can give them a call now on 0800 255 155.
Red Flag #6: No Clear Terms and Conditions
Lenders are required by law to provide you with a credit contract that includes all key terms—interest rate, total amount repayable, fees, your rights and obligations. If this isn’t clearly presented, or the language is deliberately confusing, that’s a red flag.
At Loan Direct, our terms are clear, concise, and 100% online. We don’t bury the important stuff in fine print. What you see is what you get.
Red Flag #7: Upfront Fees Before You Get the Loan
Legitimate lenders never ask for large upfront payments just to process your loan. If you’re being asked to pay a “processing fee” or “insurance charge” before you’ve even received your funds, walk away.
Loan Direct does not require any upfront payment before your loan is approved and paid out. Our application is free and obligation-free. You only start repaying once you’ve received your funds.
What to Do If You’re Unsure
If something feels off, trust your instincts. Always:
- Check the lender on the Financial Service Providers Register
- Ask for written loan terms
- Read reviews and look for FSF membership
- Get advice from someone you trust
Or better yet—let Loan Direct do the hard work for you!
Why Choose Loan Direct?
We know there are a lot of choices out there when it comes to borrowing. But here’s why Kiwis trust us:
- Access to Multiple Lenders: As loan brokers, we don’t just represent one lender. We use our network to find you the best deal—fast.
- Same Day Payout Possible: Our online application takes just 2 minutes. Once approved, you could see your funds on the same day*.
- Great Rates: Secured loans from 9.95%* and unsecured loans from 11.95%*.
- No Hoop Jumping Required: No complicated forms, no face-to-face meetings. Just fast, straightforward loans.
- Bad Credit Isn’t a Deal Breaker: We believe in second chances and offer fair options to those with poor credit.
- Trustworthy and Regulated: As an associate member of the Financial Services Federation, we’re held to the highest standards of borrower care.
- Expert Local Advice: Our lending consultants are some of the most experienced in the country. We look at your full situation and work hard to find the right solution.
Ready to get started? Apply now!
*Subject to responsible lending checks and criteria.
