Loan Sharks

 

Written By Ellise Walsh
Tue 3/15/2005 1:21 PM

In the world today, it is not at all unusual to find yourself short of the cash you need
to pay your bills, feed your family and maintain a reasonable lifestyle. For every working
stiff who runs out of money before they run out of week, there are unfortunately a number
of shady characters willing to loan you all the money you need at an exorbitant interest
rate. You will have to be careful to avoid these loan sharks when you find yourself in
need of quick cash.

Loan sharks are not just something made up in Hollywood to sell movie tickets.
Unfortunately, loan sharks are all too real and getting involved with one can wreak havoc
on your personal and professional life.

Loan sharks prey on people in financial distress. These people are often unable to obtain
loans through traditional channels like banks and savings and loans. Often this is because
of either bad credit or the nature of the debt they have incurred. A compulsive gambler
may not be able to convince their local bank loan officer to help pay off their gambling
debts. Likewise, if your credit is poor, you will find it extremely difficult to obtain a
loan at a reasonable interest rate. Any time you borrow money, it is vital to know the
interest rate you will be required to pay. If you interest rate is too high, you may
never be able to pay off your debt. Your debt may pile up faster than you can pay it off. This is good for the loan sharks but bad for you. Loan sharks want to keep you in debt. This makes you dependent on them for ever increasing amounts of money.

Even if you are not a gambling man and not involved in any shady dealings, you can still
fall victim to loan sharks of various stripes. Many so called payday loan and payday cash
advance companies are actually loan sharks in disguise. They often charge exorbitant rates
of interest in exchange for the quick cash they dispense. Although technically legal,
these businesses are considered loan sharks by a great many of their former and current
customers.

No matter what type of loan sharks you get mixed up with, extricating yourself from their
clutches may be one of the biggest challenges you will ever face. Loan sharks, both the
legal kind and the back alley kind, are notorious for chasing down the money they are owed. While not every loan shark is of the old leg breaking school, they will find ways to make your life miserable until you pay them what you owe. They will most likely visit you at your home or place of work to demand their payments. This tactic is extremely effective for the loan sharks and highly disconcerting for you. In addition to putting your personal relationships and your job in jeopardy, these type of tactics violate your sense of personal freedom and personal space.

The best way to deal with loan sharks is not to get involved with them in the first place.
Anytime you need a loan, make sure you deal only with reputable firms. Make sure you know
with whom you are dealing and that you get a full disclosure of the interest rate charged
by the lender and all associated fees. One of the most common tricks loan sharks use to
keep their customers in debt is to charge extremely high late payment fees, often as high
as 1 to 1.5% per day. You can see how quickly your loan can spiral out of control at rates
like this.

If you�ve already fallen into the clutches of a loan shark, the best way (probably the
only way) to make them go away is to pay your debt in full. You may need to swallow your
pride and borrow the funds you need from your relatives. It is always hard to admit to
financial problems, and many people let their debt get completely out of control before
they seek help. Your family and friends will most likely be willing to help you out with
your financial issues. They will probably be more understanding than you expect. After
all, most people wrestle with financial demons at some point in their lives.

Once you have banished the financial demons that loan sharks represent, it is vital that
you not repeat your past mistakes. If you have a problem with gambling, seek help for
your addiction. It is important to get your financial house in order so that you will no
longer be easy prey for the loan sharks that prowl the financial waters.