Loans - People urged to avoid illegal loan lenders

Verbal, emotional and physical threats may await for those to have approached illegal loan sharks.

Individuals have been told to avoid illegal money lenders at any cost as it is more than just the financial amount of the loans that they may need to put up with.

A number of options are open to those seeking a financial boost, such as 0% credit card deals and personal loans, but even if these avenues are closed, Faisel Rahman, board member at Debt on our Doorstep, has warned against approaching a loan shark.

He said: "One of the things that's clear about illegal money lending is that it's not just the financial cost of the loan that you are going to bear.

"You are going to bear maybe verbal, emotional or even physical threats against you."

He added that individuals should think about all of the options open to them before reaching a definitive decision, including whether a loan is really needed for something inescapable.

Meanwhile, affordable housing provider Circle Anglia published new research which revealed that over 100,000 households turned to loan sharks over the Christmas period in a bid to improve their short-term financial position.

Jane Baker of lovemoney.com recently highlighted that good deals should still be available on personal loans, despite interest rates rising over the last two years.

By Mark Hornby