Loan sharks are a very real threat to some people, although many who have never experienced them do not understand how dangerous they can become. These aren’t just fictional characters that are holding people’s families ransom—there are real loan sharks out there looking for desperate people who need money and they’ll find plenty of ways to get people on the hook.
These lenders are more commonly known as predatory lenders and some people might even view them as an illegal money lender. However, the legality of their “business” is usually balancing on the tightrope of the law, so there isn’t really a lot that the law can do besides put stricter regulations in place. If you’re dealing with debt collectors that use poor collection practices or outright loan sharks, you don’t have to do it alone.
The first thing that you need to do is take advantage of all of the consumer resources out there to assist you with learning about debt and how to pay it off properly. You’ll also find plenty of information on how to deal with less-than-reputable companies and loan sharks that might be compromising your ability to repay or even just threatening or harassing you about paying your debts.
If you are in a position where it’s possible, report the lender to the proper authorities. In the U.S., for example, that’s the FTC. You can also report bad companies to the Better Business Bureau and even alert the authorities if you believe there is a reason to do so. Of course, you need to do all of this carefully because the claims you make are legally binding and can be held against you in the future. It’s not to say that you shouldn’t file a report or make it known that a company is using bad practices, but that you should be careful in doing it.
Don’t Give In
If you owe a debt, you should absolutely pay it. However, if someone is harassing you for money or trying to get you to pay more than you owe, you don’t have to do it. Whatever you do, make sure that you find a way to talk to someone who can help you settle your debt the right way. If you have to do it without the help of the lender directly, that’s fine. If you can work with them, it would be better for everyone, but that’s not always an option.
So, if you’re dealing with a loan shark or illegal money lending issues, you don’t have to panic. There are plenty of different ways to handle this situation, including help with loan sharks and creditors who may be harassing you and giving you undue stress over the debt that you owe.
Is Borrowing Money From Loan Sharks Illegal?
If you’re talking about bona fide loan sharks that work “under the table” and don’t do things by the books, then yes, it’s illegal to borrow money from unlicensed loan sharks. However, if you find companies that are licensed and just have a bit higher fees or stricter rules involved in their lending, that could be a route to consider. It can be tempting to do something like connecting with a loan shark when money is tight, but legal or not, it’s generally not worth the stress.
If you find yourself in a financial pinch, figure out how to get back on track without having to borrow money from loan sharks or other less-than-reputable sources. Ask family and friends, talk to your creditors and make arrangements, or figure out another way so that you don’t wind up at the mercy of a loan shark and wrapped up in illegal lending.