The difficult thing is that loan sharks don't advertise themselves as such. They are so friendly in the beginning, and it can feel like they are the light at the end of the tunnel - a quick and easy loan, often from a friend of a friend, helping you out of a tight spot. If you have a poor credit rating you can feel like there is no other option.
When it comes to paying the money back, you will soon find things aren't as friendly as you first thought. Huge amounts of interest get added on, and if you question it or can't pay it, then the threats start. But at that point you are in so deep, how do you get out?
If you have suspicions that the person you have borrowed from may be a loan shark, ask yourself these questions:
- did they offer to loan you a cash
- did they say not to worry about paperwork
- did they add on lots of interest, or large fines for late payments
- have they threatened you
- have they made you feel scared of people finding out
- have they taken your driving licence, passport, or similar from you until you pay back your loan?
If you have said yes to any of those questions, there it is very likely that they are a loan shark. You can easily check to see if they are or not. Any person or business who is a legal money lender must be registered with the Financial Conduct Authority, and must obey its rules - which means they cannot treat you the way loan sharks do. The register is free to check at https://register.fca.org.uk/s/
We also work with the England Illegal Money Lending Team who run a confidential hotline that you can phone to check if someone is a properly licensed money lender. They can help and support you, and successfully prosecute loan sharks.
You can also help keep yourself safe from loan sharks by saving with and borrowing from a Credit Union such as Holdfast. We are fully licensed, and offer small safe loans to people who live or work in Essex. Our paperwork is short and simple, and we treat people fairly. When we make a decision about a loan, we are looking at your ability to pay the loan back, not your credit history, and our decisions are made by people not computers.
When you need a loan it can feel impossible to save, but we can help you save a little at a time as you pay back your loan, leaving you in a better position than ever at the end of it. Even if you don't need a loan now, if you start saving, no matter how small an amount, it can help you in the future if you need a loan. Every pound counts, and every saving is worth it.
If you need help or want to find out more, drop us an email at office@holdfastcreditunion.co.uk