Money Matters: Stop Loan Sharks Week - What to do if you find yourself in the grip of a loan shark
In this week’s Money Matters column, Wrekin’s Debt and Energy Manager Dan Bebbington delves into the murky world of illegal money lending, and what to do if you find yourself in the grip of a loan shark.
This week marks Stop Loan Sharks Week, a national campaign against the practice of illegal money lending.
Money lenders have to be registered with the Financial Conduct Authority, and operate within its regulations. Those that aren’t registered are known as loan sharks.
While it’s understandable that, for some people, an independent lender may seem like an easy solution – promising swift cash without the hassle of paperwork or credit checks – it is far from the quick financial fix they would have you believe.
Loan sharks target those who are in desperate need of funds but may be unable to access other forms of loans or credit. This could be because they have a poor credit history, or have already borrowed the maximum amount they can get.
Because they are completely unregulated, loan sharks can lend to anyone, regardless of whether that person can realistically afford the repayments.
But on top of paying back the money they borrowed, victims of loan sharks can end up paying eye-watering interest which can mean the debt keeps growing – trapping their victims in a never-ending cycle.
Sharks can also decide to increase their interest rates at any time, or add huge sums of money onto the debt for late repayments.
Loan sharks are known to resort to illegal practices to get their money back. This can range from intimidation and harassment, to violence or taking credit cards and belongings from their victims, leaving them feeling helpless and isolated.
Escaping the clutches of a loan shark can seem like an impossible task, but there is help out there.
It’s important to remember you haven’t broken the law, they have.
The first step is to seek advice from a reputable organisation or charity. They will be able to offer confidential, non-judgemental support and tailored advice on your situation, and talk you through your options.
To report a loan shark, you can contact the Illegal Money Lending Team via their website, www.stoploansharks.co.uk or on 0300 555 2222.
Before taking out a loan, you can check the lender is registered with the Financial Conduct Authority by going to www.fca.org.uk.
Wrekin Housing Group customers can also contact our Money Matters team for advice and support on debt or any other money worries.
15th May 2024