Watch Out For Loan Sharks During The Cost of Living Crisis
Loan sharks have been around for many years, but have gone relatively quiet until recently. Since the cost of living crisis and rising interest rates, they have seen a resurgence. By preying on people’s situations and their desperateness for money (which sometimes can’t be helped), some people feel they have no choice but to turn to loan sharks. However, loan sharks aren’t regulated and if you think you can take out a loan and not pay it back with them, then you’d be mistaken. Most loan sharks are criminals, usually tied into other types of crimes such as money laundering, weapons or drugs, and this can make them seem untouchable in many instances.
When you take out a loan from a loan shark, you should expect the money to keep being repaid even when you think you’ve paid everything back and that’s because for them, once they have you, they won’t let go. Because they know your situation, they’ll keep preying on it and you’ll be expected to pay back more money or to carry out criminal acts as a way to repay the debt you owe them. Well in this blog, we’ll aim to help you spot a loan shark and we’ll also cover a case where a loan shark was recently busted in the Lancashire area.
How To Spot A Loan Shark
Loan sharks come in all shapes and sizes, from people operating from houses to out of their vehicles and some even operate under the guise of businesses. There are a number of things that can help you to spot a loan shark such as:
- Loan sharks won’t have a consumer credit licence, you can check to see if your lender has one here.
- You won’t be given or offered a credit agreement.
- Your interest rate and repayments won’t be fixed and you could find yourself gradually paying back more each month.
- They will likely operate from premises that don’t meet the standards of a typical lender.
Loan Shark – Catching The Criminals
In July, a police raid caught a loan shark who would charge up to 100,000pc. The raid happened on a normal residential street in Lancashire, where two unmarked vehicles and five armed officers pulled up to batter down the door of a local residence and a man in his 30s was apprehended and taken away by police. You can find out more here on the Mail website.
IMLT was responsible for the raid whilst is England’s Illegal Money Lending Team, they are a specialist branch of trading standards who are tasked with taking down loan sharks. It’s estimated that more than 1 million people each year borrow from illegal lenders, as they struggle to make ends meet or believe they can’t get other forms of credit.
It’s important to remember that not all loan sharks operate the same either and some might seem like legitimate businesses. So, if you think you have lent money from a loan shark or have found yourself with a never ending loan from a shady individual, then it’s best to contact trading standards and your local police force.
What Do I Do If I Need A Loan?
One of the reasons people turn to loan sharks is they feel they have no other option, however that isn’t always true. People turn to loan sharks due to bad credit or being declined credit in the past, but local loan companies such as ourselves or places such as credit unions can help. We don’t just look at credit ratings, we take into account your personal circumstances, affordability and what your income and outgoings are when making a loan decision.