If you are short of money this month and you have incurred an unexpected cost such as emergency car repairs or medical bills then you might look to borrow money online instantly and find yourself turning to short term loans to help you get out of your financial emergency until your next payday.
However, it is important to be aware that there are loan sharks in the loan market ready to scam you for your money, charging higher than acceptable interest rates and preying on those who are desperate and in need of fast cash. That is why it is important to understand what a loan shark is and why you should avoid them at all costs.
Kallyss works with a panel of trusted and reputable short term loan lenders in the USA and can provide payday loans, even for those with bad credit and we can also provide loans of any amount up to $35,000, from a $500 loan today to a $1000 loan today, our lenders can help you find the loan you need for your specific needs and circumstances. We will put you in contact with only approved reputable lenders who will be able to provide you with the best loan for your circumstances.
This guide explores what a loan shark is and how you can spot them and why they are dangerous and can potentially cause a lot more harm to your financial stability and situation.
What Does a Loan Shark Do?
Simply put, a loan shark is an individual or an organization that will lend money illegally without having the proper government authorization to do so. It is estimated that there are millions of people in the US who are in serious debt because they have borrowed money from illegal money lenders or loan sharks.
Loan Sharks can be most dangerous because they will target those individuals who they know are desperate for money and are therefore particularly vulnerable. Usually those with bad credit who are struggling to be accepted for a loan, maybe because the interest rate on repayments is too high for them.
Loan Sharks are able to do business because it is not always straightforward to realise that you are dealing with a loan shark, loan sharks allow you to full a full sense of security before you borrow from them and then, because what they are doing is illegal, they can transform when you begin to owe them money.
You will not be in trouble if it is found that you borrowed from a loan shark because although what they are doing is illegal, what you are doing is not and therefore you will not get in trouble if you report your loan shark to the police.
Here are some of the ways that you can spot a loan shark.
How Can I Spot A Loan Shark?
If you are worried that you are about to borrow any amount of money from a loan shark then you can get in contact with the government or the police to see if the people that you are speaking to are able to lend you money legally.
Moreover, a loan shark might pretend to be from a legitimate firm, if you are worried then it is worth speaking to the firm to ask them directly whether the person works for them because the loan shark may be lying.
There are also some other red flags or warning signs that may come up which could indicate that you are talking to a loan shark and not a legitimate lender. These include:
- Someone you recently met offers to lend you money – Loan Sharks can often disguise themselves as just random people on the street who you meet and seem friendly, just like a friend, however you should always be cautious if you have just met someone and they begin to offer you loans
- Lending without any form of credit check – It is highly unlikely that authorised lenders will not do any credit checks on your account before offering you a loan, yes, there are soft checks and hard checks but a check will be done regardless and if you are offered a loan without a credit check then it may be from a loan shark
- Your loan does not seem to end – Loan Sharks are dangerous because once you begin to owe them money, you will continue to owe them money for a long time, they will add interest or more loans to your deal in order that you stay indebted to them forever
- Taking your possessions – Although secured loans exist where your money is secured against your possessions, reputable lenders will never take your possessions as security whereas loan sharks will do without a formal agreement
- You are offered a cash loan – One of the clearest signs of a loan shark is that you are offered your loan in cash, reputable lenders will never do this and this is a hallmark sign of a loan shark.
- They threaten you – Of course, when you take out a payday loan with Kallyss, our lenders will never threaten you, there are consequences if you do not repay your payday loan on time such as late fees or affects on your credit score, but there will never be any threatening and violent behaviour which there will be from loan sharks
- Lack of Paperwork and Information – Real loans will come packed full of information about when the loan will end, how much each installment will be and more, whether it is an installment loan or even just a $600 loan, loan sharks will just hand you the money without explaining more and with a lack of contracts or official paperwork
What Should I Do If I Borrowed From A Loan Shark?
If you realize that you have borrowed money from a loan shark, then do not fear, you have not done anything illegal. Instead you should report your lender and everything that has happened to the police so that they can deal with it properly. You should also then consider looking for reputable lenders of payday loans or any other financial product, so long as it is legal in your state to do so.