Watch out, trap! How to identify loan sharks

Loan sharks are dubious credit providers who use the financial plight of others to enrich themselves. Here threatens a rude awakening, when suddenly hidden costs appear. Mousetrap on a wooden table with a 10 Euro bill as bait


In order not to fall into the trap, consumers should check offers particularly closely.

Borrow money without Schufa? Often a lock offer

Often it is a loan shark, if the provider promises a loan without Schufa query. He is particularly appealing to people who urgently need a cash injection, but would not easily get a loan from reputable credit institutions because their credit rating is insufficient. Recklessly formulated ads that make many promises and advertise with unrealistically good conditions, most likely come from a dubious provider. If the offer also contains few and spongy information about the conditions, there is a high probability that a loan shark is behind it.

Real provider or only credit intermediary?

An important question is whether it is actually a credit provider or just an intermediary. Credit intermediaries often charge high fees for their services, which are hidden in the fine print. For borrowers who have not read the contract thoroughly, the brokerage fee will later be a nasty surprise, making the loan more expensive than originally thought. Whether the provider is serious, can also be seen from whether he has a license of the BaFin (Federal Financial Supervisory Authority). This can easily be checked on BaFin’s website , since licensed lenders are recorded in a database there.

Loan sharks require excessive interest rates

Last but not least, the amount of interest also indicates whether it is a reputable financial institution. Usurious interest rates can lead to a credit agreement in court being declared ineffective. Unfortunately, it is not exactly defined when it comes to immoral interest rates. But if they are at the same level or even higher than the interest on the credit line, caution is required.

Before consumers go into the hands of a credit shark, they should look for ways to improve their chances of getting credit from a reputable financial institution. Possibly, the bank can be convinced by the inclusion of a second borrower with good credit rating in the loan agreement. Even with a guarantor, the credit institution can be offered additional security, so that it grants the consumer a loan.