The real loan sharks make short term loans companies look tame

There has been plenty of criticism of short term loans companies recently and some commentators have compared them to “loans sharks”, but any body with genuine experience of the so called “doorstep lenders”, an alternative name for “loans sharks” would know that the real short term loans companies seem positively benign, in comparison.

There have been several well reported horror stories reported in the media recently, pinpointing the real differences between the legal, albeit controversial activities of the instant cash loans companies and the illegal doorstep lenders.

Loans sharks or doorstep lenders as they apparently prefer to be , exist in their thousands all over Britain and appear to thrive in conditions of poverty and desperation.

The big council estates, where many people are unemployed and struggling to pay their bills,  seem to be the perfect places for these unsavoury characters.

They have no offices, and give no receipts but are always ready to lend small amounts of cash on a short term basis without bothering to do any credit checks. They are unlicensed and are allegedly ready to do anything to make their borrowers pay back the loans at such incredible rates of interest that even short term loans companies would find them mouth watering.

This immediately separates them from the official short term loans lenders, who have high street shops, user friendly websites, and advertise freely wherever they can.
The usual scenario seems to follow a pattern from one case to the next, with few people confident enough to tell their stories.

A person gets into debt and needs a couple of hundred pounds to tide them over until they get paid from some other source, typically the dole. The payment by the loan shark is an instant cash loan, but borrowers have to pay back about 10% of the loan every week. If they can’t make their repayments, then they either get an additional loan, which of course has to be repaid as well, plus interest, or the lender starts intimidating the borrower and may even use physical force to remove property.

The head of the British Illegal Money Lending Team, Tony Quigley,  said that the practice amounted to “extortion” and was totally illegal. He said that there was at least one loan shark wherever there was a market for them and they preyed on the most vulnerable in the community.

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