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January 23rd, 2026
Everyone wants to be able to afford Christmas presents for their loved ones this time of year. However, sometimes finances run thin and it becomes close to impossible to buy a gift for everyone. That is why there are a lot of people who consider loans when purchasing gifts for their loved ones. Scammers know that Christmas loans are growing in popularity due to the coronavirus pandemic this year, and are taking advantage of that to steal people’s money. Here is how the Christmas loans scam works that everyone should be aware of.
Are Christmas Cash Now Payday Loans Legit?
Most online lenders will offer you a payday loan to borrow $100 to $1000 in order to purchase Christmas gifts for your family and friends. The APR on these loans is usually a ridiculous 36% – 390%, whereas in most states the legal maximum APR that you can get is between 6% – 10%. This just goes to show that a lot of these online lenders are after your money, and will spike up your interest rate to get every penny they can out of you. They also don’t run a credit check on you to see if you’re even qualified to pay back these loans!
These online lenders will even make these loans due in just a few weeks, and even if a loan took years to repay it the company still adds on unexpected charges to the loan. This usually increases financial pressures on individuals, since they took out a loan without really thinking about it out of desperation. Then once they look at the payments they need to make, they realize what they have done when it is already too late to fix it. There are some people who have even lost their vehicles or houses due to their mistake in taking out loans from companies they barely even researched!
How Scammers Initiate the Christmas Loans Scam
Scammers call their victims, pretending to be a loan lender. They tell their victims about an unbelievable 0% APR financing program, and state that they can borrow as much money as they want to without a credit check. All the victim needs to do is provide them with their personal information and their financial information. Once the scammer has this, they commit identity theft with the victims’ information and drain their bank accounts.
There are also fake phishing links to websites sent via email or text message that claim to be an online lender for loans. When a victim goes on this fake website, there’s usually a form that asks for their personal and financial information. Once the victim enters this, the scammer can steal their information to commit identity fraud and steal their money.
What if it’s a Legit Christmas Loan?
Even if its a legit Christmas loan, the APR’s still skyrocket when you purchase a loan through a legit company. There are usually two options you can choose from when obtaining a loan, which are personal loans and point-of-sale financing loans. While some of the point-of-sale financing loan options offer a 0% interest rate, it isn’t always guaranteed and usually leaves people bankrupt. Even the personal loan interest rates aren’t always the best unless you have an amazing credit score. This could mean that you would be stuck paying off the Christmas loan until next year, possibly even longer, just to get your family and friends Christmas gifts.
What Are Some Alternatives to the Christmas Loans Scam?
- See if you can get short-term loans through your bank.
- Talk to a trusted friend or family member before making a decision.
- Talk to your trusted credit card company to see if you can finance a present.
- Find a trusted retailer and obtain a credit card that has financing options with a 0% interest rate, like Best Buy, Apple, or Amazon.
Social Catfish is Here to Help You!
At Social Catfish, we want to help you verify the identities of those who might seem suspicious to you. If you have their name, email address, phone number, social media username, or image, you can reverse search and see who the suspected person was that you’ve been in contact with if you think you’ve been a victim of this Christmas loan scam.
