Avoiding loan sharks when seeking credit

Thousands of people have sought out loans to finance something, whether that be a mortgage to get them on the property ladder, or a payday loan to help pay an unexpected bill.  

Seeking a loan isn’t necessarily a bad thing, however you should look out for unscrupulous lenders. These lenders, known as loan sharks, often reach out via social media with attractive loan offers which could lure you in.  

However, these illegal loans can quickly turn sour when it comes to the repayment stage. Borrowers are often threatened with violence, and become trapped by their debt to these lenders.  

Before borrowing any money, you can check to see if a lender is authorised by the Financial Conduct Authority. 

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Credit Unions

For those who are looking to use credit, Money Advisor Stuart Dearden gave the following advice: “Talk to your local Credit Union to see if you can get help there.  

“Credit Union loans are typically charged at a much lower interest rate than High Street lenders, have more flexible lending requirements and affordable repayments.” 

Don’t be tricked by the offers of loan sharks. If you have any doubts, you can get in contact with the Money Advice Team, and they’ll be able to give you further information on what you should be considering before taking out any credit."

If you think you’ve been the victim of loan sharking, you should report this to the Illegal Money Lending Team by visiting their website.