What are loan sharks and what do they do? In what ways is what they do illegal?

Answer 1

Loan Sharks lend money to people who either have terrible credit and can not get a loan from the bank, or they need money so fast they cant wait. They charge terribly high interest rates and often their means of collection are "shady".

If you needed a 10000$ fast and went to a loan shark-- what he would do is set a time frame, say 6 months and charge you interest by the month. Maybe 10 % a month. So for every month you have his cash he would probably be charing you a 1000$ in interest.

The reason this is illegal is because the govt knows that the interest rates being charged are way to high and means of collection are often threats and injuries... if not worse.

Answer 2

Dear Elly,

Loansharks are people who loan money to people who are apparently in desperation, and can not get a loan by legal means.

These loansharks loan unsecured amounts money requested, and expect outrageous sums of interest in return, and usually want it within a short period of time.

Usually the borrower cannot make the payments back to the loanshark, and that borrower usually is the recipient of violence by the loanshark. In many instances, death of the borrower is the result.

This practice of loansharking is illegal, of course, for obvious reason.

Hope this helps you!

Answer 3

Their alot like the great white but have a bigger bite,charge high interest on the loan.
If u get behind in yr loan repayment they come to visit u, ask what the problem & then show u what a hammer can do to a kneecap.
At no time would they consider killing u because how would they get their money back if yr dead ??

Answer 4

They loan money at exorbitant rates and use threats of physical harm to collect the debt if you do not pay it when due..