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Don’t let a loan shark ruin your summer

Tenants' Link
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Don’t let a loan shark ruin your summer

With summer holidays around the corner and the ever-increasing cost of living it might seem tempting to borrow money to get you through a tough time. But remember, accepting cash from a loan shark or doorstep lender, will more likely ruin your summer and turn out to be the worst decision you ever make.

Loan sharks charge extortionate interest rates, which means you will end up paying back considerably more than you borrowed in the first place. And, although they may seem friendly at first, these illegal lenders soon turn nasty and often use intimidation to recover their money; threatening to take away your credit cards and valuables or even physically hurting you or your family if you don’t pay up. 

Nowadays, illegal money lenders are also targeting people on WhatsApp and through social media platforms like Snapchat and Facebook, and even online dating sites. They offer short-term loans, then increase the repayments and add extra costs, and like doorstep loan sharks they often threaten violence if money is not repaid.

If you have borrowed money from someone who is threatening you, contact the police straight away and report them to the Illegal Money Lending Team. If you want to check if a money lender is legal, you can look at the online register to see if that person is authorised by the Financial Conduct Authority (FCA). If not authorised by the FCA, they are breaking the law. 

Are you drowning in debt?

If you are in debt or feel like you’re drowning in financial worries it is much better to work out a way forward without the need to borrow more money, especially not from a doorstep lender or loan shark. Our Welfare Rights & Money Advice Team offer free, impartial advice and support to help you manage your money safely without the need to take out a loan or get into more debt. We can help you budget and talk to the organisations you owe money to, to set up affordable payment plans and chart a course out of your debt problems.

If you really need to borrow money it is much safer to approach a credit union for a loan and this usually works out cheaper than home credit or payday loans. You can work out how much a credit union loan would cost you by using the online loan calculator on the Association of British Credit Unions website. And unlike a loan shark, a credit union will provide you with clear paperwork so you can see upfront how much you are borrowing and repaying. Credit unions offer a lifeline for anyone who can’t access regular high street bank accounts. You can still open an account even if you have poor or no credit history.

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