Hull in print : Feature - Your Council working in partnership to make our city safer

The Deep isn't the only place in Hull where you'll find sharks.
Illegal money lenders, referred to as 'loan sharks' are believed to be doing business in the city, particularly with vulnerable groups such as single parents, low income families and people in rented accommodation who've been refused other types of credit.
They can sometimes charge extortionate rates of more than 1,000 per cent interest, meaning that for a loan of £100 you may have to pay back £1,000.
"We know these people use intimidation, violence and even sexual exploitation to get payments," says Mike Pindar, from the council's trading standards section.
"It's difficult to estimate the scale of the problem, because victims don't readily come forward, but we believe loan sharks will be taking advantage of the economic downturn and causing even greater debt and despair."

Team shows its teeth

Trading standards officers in Hull have now teamed up with the government's national Illegal Money Lending Team in an effort to tackle loans sharks in Hull.
Their aim is to:

encourage victims to come forward so loan sharks can be prosecuted (and jailed in certain cases)
change the perception among loan sharks that illegal money lending is rarely prosecuted
develop ways of replacing the removed money lenders with more support for their victims

Any business, large or small, which is lending money without a consumer credit licence will be targeted.
Without such a licence, businesses can't collect debts legally.

Too much to chew

But loan sharks aren't the only problem.
Legal ways in which people can borrow money, including credit cards, store cards and hire purchase agreements, can also lead to debt problems.
"For anyone who is eligible, it's very easy to go out and get into thousands of pounds of debt without realising the repercussions," adds Mike.
"If you sign up to credit agreements and your circumstances change, for example if you lose your job, you may not be able to keep up regular payments, and in some cases you could lose your home if the debt is secured.
"Signing up for any credit can be useful as you can spread the cost of paying for something over a long period of time, but in the long run it will cost you more.
They key is to think carefully about the real cost of credit before signing up."

Hire purchase

Hire purchase is one example of a credit deal where you need to think carefully before committing.
Unlike other forms of credit, you do not legally own the goods until you've paid back all the money you owe.
Whether it's a car, furniture or a computer, the finance company providing the credit can take back the goods if you don't keep up payments, and you may be liable for damage caused to the goods during the contract period.
At the end of this period, if you want the option of owning the goods outright, you may have to pay an added fee.

In-store credit

Most major shops or retail groups offer their own in-store credit cards which can be used to buy goods only in that store.
"Interest is charged on how much you owe each month, but the amount of debt can build up rapidly if only the minimum monthly repayments are made," adds Mike.
"Don't be pressurised into signing up at the till – but instead take the agreement form away and read all the details carefully.
"Most importantly, ask yourself if you really need it and if you can afford it.
"And if you do decide to sign up remember to compare the APRs (annual percentage rates), because, usually, the lower the APR, the lower the interest."

info

If you have been a victim of a loan shark, or know of a loan shark operating in your area, call the 24-hour hotline on 0300 555 2222.
If you need advice about debt, visit the CLAC (community legal advice centre), based in Essex House, in the city centre, call it on 300300 or email welfare.rights@hullcc.gov.uk
You can also visit www.consumerdirect.gov.uk or call 0845 404 0506.
For information on easy ways to save, and access to low-cost, affordable loans, contact Hull and East Yorkshire Credit Union, a financial services business owned and run by its members, which has a regular column in Hull in print (see page 8).


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