Watch out for loan sharks
18/12/08
Consumers have been warned by the Riverside Group and The Stop Loan Sharks project to beware of loan sharks who are taking advantage of the current economic climate and preying on the vulnerable.
The Department for Work and Pensions (DWP) has helped to fund The Riverside Group to offer borrower’s more realistic loans that would normally be at risk from taking out very interest loans from lenders who sell door to door.
“They may not have fins or killer jaws, but loan sharks are every bit as dangerous and predatory as their name suggests”, commented Executive Member for Environmental Protection at St Helens Council Carole Kavanagh.
“More than 1,500 families are affected in the North West every year. Victims are not only charged astronomical interest rates but often face violence, intimidation or blackmail if they fall behind with their payments.”
She continued, “The average cost of borrowing from a loan shark is three times the highest cost of legal credit. The highest interest rate the team have come across so far was 117,000% APR. One victim was receiving benefits of £74 per week. The loan shark took £50 a week, leaving them just £24 to live on.”
