How To Swim Along With The Loan Sharks

  • April 3, 2019

Ever wondered if how many of people think of their financial decisions? The answer is there is probably a definite number especially if you come from a low-income earner class. Talking about applying for loans, it is unavoidable that the only matter of concern is the money getting on to your hand as soon as possible, without thinking of the aftermath such forgetting to consider your income if it is sufficient to cover your possible monthly payments without straining your budget. Paying off the loan should not cost you giving more than fifty percent of your monthly earning but despite this information, we cannot avoid that you can still be unsure about the further things about paying the loaned money that is why it is advisable to make a visit to financial planners and counselor who knows better about this kind of stuff and will educate you to avoid the Loan sharks. 

For financial analysts, Loan sharks is best described as the one who often targets low to mid-income and desperate families. They are typically unlicensed lender that offers people loans for a short period of time with an extremely high interest rates and also often targeting potential borrowers with poor history when it comes to credits, offering bad terms to the point of using threats and even violence to collect your debts. Dealing with them would not only put yourself in a worse financial situation that will result to so much anxiety and stress but it may also put your life in danger. Another thing is that borrowing from them would cost you a really high price such as paying far more extra in interest than you would to any legal borrowing.

How to Spot These Unlicensed Loaning Agencies

How do you make sure that you are not dealing and transacting with one when it comes to loaning? There is actually warning signs on how to avoid this kind of money-lenders. At first, when both of you are in the starting point of the transaction, they will start out looking the friendliest that you could ever meet though they could stay that way as long as you keep your payments. In detecting loan sharks, first, you must observe the rates, loan sharks charge you ridiculously excessive interest rates on loans, they charge you higher than what the law in your local have prescribed. Second is they would ask for a collateral such as requiring you to turn over your ATM cards along with the pin and other confidential information about your account where it could expose your identity and make an unauthorized transaction. They don’t also have a formal contract and will show you no records of payment unlike your local banks, licensed private lending corporation, and government agencies. Through this, they could potentially abuse you through adding you and extra charges at any time. Given that there are no legal contracts, in case of any trouble, there is no way you could file a complaint for any violations since you are left with no evidence.

Prevention is always better than cure, that is why to avoid these loan sharks that you could possibly meet and would offer you something, you better go to your any nearest legal companies when it comes to financial needs.


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