With the popularity of online banking, a growing number of people are turning away from community banks and setting their sights on national institutions. While there is nothing wrong with considering this idea, you don’t want to make a change until you thoroughly compare the pros and cons of both options.
Here are three of the top reasons to shun national banks for one in your local community:
1. Higher level of customer service. This may not always be the case, but most people agree that they get better service from a local bank than one that is doing business from one side of the country to the next.
Here is something else to consider: you can visit a local branch if you want to speak with somebody in person. This is not always an option when you bank with a national brand.
2. Support the local economy. There is nothing more important than putting your money to work to grow your local economy, especially with the way things have gone over the past decade.
Small businesses, such as community banks, are in position to create many local jobs. Along with this, local companies can turn to these financial institutions for financing. As a result, those companies are also able to boost the local economy through new hires and increased profits.
Big banks don’t typically care about local communities. Big banks spend a small amount of time and money on small businesses.
If you want to support your local economy, choose a community bank.
3. Community banks share your goals. Think about it this way: when the economy thrives in a particular area so do the banks. For this reason, it is safe to assume that they share many of your same goals for your community. Can the same be said about bigger, national banks that focus most their time and attention on Wall Street and multi-billion dollar corporations?
Regardless of why you are in search of a bank, consider all your options. Even though it is important to do what is best for you and your money, make sure you consider the benefits of choosing a community bank.
Once the holiday season comes and goes, you may feel empty inside for a few days. After all, you put a lot of time into preparing for a week (or more) of fun.
For many, spending during the holiday season can get out of control. Even if you try to keep yourself in check, you may find that you have gone too far. Preventing this scenario will keep you from desperate situations, including obtaining financing, or worse – considering loan sharks to juggle your finances.
Once the holiday season is over and January is here, it is time to review your balance sheet. When doing so, it is important to focus on the following details:
Credit card debt. Did you spend any money on your credit card during the holidays? If so, it is your hopes that you can pay off the balance, in full, the next time a statement arrives. This allows you to put your holiday spending in the past, while also avoiding an interest charge.
Focus on your budget. Let’s face it: you may have blown past your budget in December. From gifts to food to travel, you had a lot on your plate. Now, however, it is time to get back on track. Review your budget, make any necessary changes, and be sure that you are 100 percent comfortable with every last category.
Have a plan for saving more. A budget is more than something that shows you how much you are spending. It is also something that helps you save more. What changes can you make to save more money in the new year?
The way you review your finances after the holiday season is dependent on many personal factors. Even so, most people find it helpful to focus on the three details above.
With the right approach, you will feel better about your financial situation as the calendar turns and you are faced with another 12 months.
There are people who love to negotiate, as well as those who would rather avoid this at all costs.
Even if you aren’t the type who looks forward to this, there are a few times when opening your mouth can save you quite a bit of money – and a loan or debt.
Here are three things you absolutely need to negotiate:
Cell phone bill. Negotiating your phone bill is easier than ever before, due in large part to growing competition throughout the industry.
As the end of your contract closes in, reach out to your cell phone provider to discuss your options. Even if you only save a few dollars per month, this has a way of adding up over the course of a year.
Furniture. When was the last time you visited a furniture store? As you probably recall, the prices often seem much higher than what they should be.
You should never hesitate to ask for a discount when shopping for furniture, which includes mattresses.
Some stores are more willing than others to negotiate, but you should always do your best to save. Sometimes all it takes is the suggestion of a lower price in order to keep some money in your pocket.
Medical bill. There is nothing worse than receiving a bill from a medical facility or doctor that is higher than expected.
If it’s a small bill, such as $100 or less, it’s probably best to make the payment and move on. However, in the event of a larger bill, don’t wait to contact the appropriate party to discuss your options. For example, you may qualify for a discount if you pay the amount in full.
There are those who negotiate everything they want to purchase, as well as those who typically shy away from this. Negotiating price helps to keep things fair when you know that you can get a better deal elsewhere, or you are being treated unfairly. This ultimately will help your financial situation and help you to avoid another loan.
Regardless of where you fit in, the three situations above call for a negotiation. If you’re lucky, you’ll find yourself saving money soon enough.
There are a lot of new things happening in today’s crazy economic climate and it can be hard to keep track of everything. Businesses are being forced to close temporarily. The government is sending out assistance checks. The Federal Reserve has cut interest rates to zero.
Many of these measures are taken to protect you, the consumer. However, if you’re not careful then one of these measures (the Federal Reserve lowering cutting interest rates) could work against you. This is because low-interest rates encourage predatory lenders. What exactly is a predatory lender? Let’s take a look and explore a few ways that you can avoid them.
What’s an anglerfish?
An anglerfish is a deepwater fish known for their freaky appearance and (more famously) for luring their prey in with a bulb at the end of their dorsal fin that lights up.
Anglerfish, since they live in the deep ocean where it’s incredibly dark, lure unsuspecting fish in with their bright dorsal fin. Fish swim up curiously and then when they get close enough, they’re gobbled up by the anglerfish. Are those fish dumb for swimming up to the light? Not really! They couldn’t see the anglerfish and were just exploring around. They didn’t know any better and didn’t realize their mistake until it was too late.
So what does this have to do with you and predatory lenders?
It’s relevant to you because in the world of finance there are people and institutions that act like anglerfish. Some (not all!) people working in the personal world are known for their predatory tactics. They deliberately try and take advantage of trusting people who don’t know any better. Another name for this type of person is a loan shark.
What is a loan shark
A loan shark is an illegal lender that targets low income or desperate families. They appear friendly to win your trust but then loan you money at rates that are significantly higher than other lenders. A loan shark is a common name for predatory lenders, however, we prefer the term anglerfish for two reasons:
1. Sharks are the biggest, baddest predators in the ocean. Everyone knows what a shark is and know to steer clear when one comes by.
2. Anglerfish are sneaky. They lure in prey with something bright and shiny and take advantage of curious fish.
When someone goes to a loan shark for money, the loan shark happily provides it at an interest rate that is drastically higher than what other lenders charge. That person doesn’t realize that the rate is incredibly high. They just simply don’t know any better and happily sign on the dotted line. The anglerfish has snatched another victim.
Just like our example earlier, are these people dumb for getting taken advantage of? Not really! They’re just exploring around in the dark and don’t know any better. They trust the lender to have their best interests at heart.
When your mechanic says that you need a new carburetor, you probably listen. When your dentist says you need a crown put in, you listen. Why would you not listen to a financier when they tell you what you need to pay in interest?
How loan sharks make their money
Understanding how loan sharks make their money and what their incentives are can help you avoid them. This is the general process of how a loan shark makes their money:
1. Find nice, unsuspecting people in desperate need of money.
2. Appear friendly to win their trust and offer (what appears to be) a good deal.
3. Trap these people into an agreement where they’ll pay a ton of money to the loan shark over the course of years.
It’s important to note than the process of lending/borrowing money by itself doesn’t constitute a loan shark. For example, if you go to an institution like Bank of America and take out a mortgage, that’s very different than dealing with a loan shark.
The most important factor to look at when accepting a loan of any kind is to look at the interest rate that you’re being offered. The interest rate is just the proportion of a loan that is charged as interest to the borrower, typically expressed as an annual percentage of the loan outstanding. For example, if you borrow $10,000 for 1 year at 4% interest, you’ll have to pay back an additional $400 in addition to the $10,000 you borrowed. That is the price you pay the lender in exchange for the money.
How to recognize a loan shark
Having a general idea of what a good and bad interest rate is for certain types of loans can be the easiest way to spot a red flag. Here is a general guide to understanding interest rates.
➢ Under 5% – Any interest rate that is under 5% is fairly common and a pretty decent rate. If the offer includes a rate that has an interest rate under 5% then you’re probably not dealing with a loan shark.
➢ 5%-10% – This is a little bit higher than normal but it still doesn’t mean you’re dealing with a loan shark. An interest rate between 5%-10% could just be higher due to the nature of the loan you’re asking for.
➢ 10%+ – This is where you should definitely start to be suspicious. The only interest rates that are consistently over 10% are credit card rates (usually around 20%). Any other rate that’s this high should alert a siren in your mind.
While considering this, it’s also important to look at the terms of the entire deal. Most times, loan sharks will lure you in with offers of quick money upfront and low initial payments but then jack the interest rate up incredibly high after a few months have passed.
This is why it’s important to really do your research when accepting a loan. It may be an enticing offer and get you money that you need but that doesn’t mean it’s a good deal.
Why this is a dangerous time for loan sharks
The current economic climate right now is an especially ripe feeding ground for loan sharks (or anglerfish). There are three reasons why this is:
1. Low interest rates – This means that there is a lot of incentive for people to borrow money because it’s much cheaper than normal. It can also mean higher profits for a loan shark and will make them more aggressive.
2. Unemployment – millions of people are filing for unemployment as they lose their jobs because of the coronavirus. If the situation continues, these people might struggle to make ends meet and have to borrow money to pay their bills.
3. Desperation – When people can’t work and pay their bills or feed their families, they start to get desperate. If they can’t turn anywhere to earn money, they’ll probably turn to questionable lenders in search of cash.
All three of these factors are incentives for loan sharks to take advantage of people. The most unfortunate part is that getting locked into a predatory loan can keep you paying extra money for years after the recession and hard times have passed. Although things may seem dire at the moment, a hasty decision to say yes to a loan shark can leave you financially crippled for years to come.
To ensure that doesn’t happen to you, here are a few ways you can avoid predatory lenders, loan sharks, and anglerfish.
Tips to avoid loan sharks
To ensure that you don’t get taken advantage of, here are a few things to always look out for when speaking with a lender.
➢ Be wary of a stranger trying to do you a favor – Often times, loan sharks will be overly friendly and compensating to try and lure you into their deal. If a random stranger suddenly approaches you acting like your best friend and offering an amazing deal, there is probably something they’re not telling you.
➢ Always do research on the interest rate being offered – We mentioned this already but always do a little research on the rate you’re offered to make sure it’s a fair market rate. By “market rate”, we just mean a rate that is accepted as fair by the overall market. You can do research by asking other lenders for the same deal and seeing what they offer you.
Think of it like shopping around a few used car dealerships trying to find the best price. If the standard price for a certain model is $5,000 but you suddenly find one dealer who will sell you that model for $500, it’s cause for suspicion.
➢ If it sounds too good to be true, it probably is – This saying can be applied to lots of things but it is especially true here. If you’re desperate for cash and get approached by a lender who an amazing deal, it’s probably too good to be true.
➢ Be aware when people approach you with a deal – There is another saying that goes “everyone is selling something”. If someone approaches you with an amazing deal for you you should ask yourself what they’re selling you and how they will profit from the deal. If they had nothing to gain then what would inspire a total stranger to approach you and offer you a deal?
➢ Recognize high-pressure sales tactics –
○ Forcing you to sign something on the spot.
○ Threatening to rescind an offer if you leave.
○ Saying a deal is only available that day/week.
○ Discouraging you from talking to other businesses.
These are all signs of high-pressure sales tactics. The goal is to get you into the room and sign you on the spot. If you start to feel the pressure to make a commitment on the spot then that’s a sign that you should probably leave. If you start to leave and they panic and start talking faster then you know you’ve made the right decision.
This one can be hard to overcome because salespeople are naturally good talkers. They can address all your concerns and make you feel as though you’re stupid for not signing. However, a truly professional salesperson won’t pressure you to sign on the spot. If they’re really working in your best interests and following all the rules then they should have no problem with you leaving and doing your due diligence.
These are just a few ways that you can avoid predatory lenders. We hope that you’ve found this article valuable and it helps you in the future. Remember, as long as you understand how anglerfish catch their prey you’ll be smart enough to stay away from any bobbing lights in the distance! If you’re interested in reading more, please subscribe below to get alerted of new articles as we write them. You can also explore some of our other articles at LoanSharks.com.
A home equity line of credit (HELOC) is a great way to get your hands on money in a hurry. As long as you have equity in your home, there is not much fear of being denied.
Despite the fact that getting your hands on this money may be an easy process, it doesn’t mean you should actually move forward. There are five reasons why avoiding a home equity line of credit may be in your best interest:
Unstable income. If you don’t know where your next paycheck is coming from, maybe because you work as a contractor, a HELOC is not the best idea. In the event you are unable to keep up with the payment, the lender could begin the foreclosure process.
You don’t want to (or can’t afford) the fees. Depending on the lender, it can be expensive to obtain a HELOC. There are fees and upfront costs to think about.
You don’t need that much money. A HELOC is often a good idea if you need a large sum of money all at once, such as to complete a home renovation. If you only require a small amount of money, you should probably turn to your emergency fund or a low interest credit card.
You are scared of an interest rate increase. Unless you have a fixed rate line of credit, an interest rate increase could come into play at some point. This is something to consider before you sign on the dotted line. Make sure you are comfortable with the current rate, as well as the “cap” set by the lender.
You don’t really need the money. The idea of a HELOC may excite you. After all, who doesn’t want access to extra money? But remember this: the money is not free. You are borrowing against the equity in your home, while also paying interest. If you don’t need the money right now, forget about a HELOC for the time being.
These are some of the many reasons to avoid a home equity line of credit. Now, here is the next big question: what are some of the top reasons to apply for a HELOC?
There are several places you can turn when your business is in need of money. Since this decision will impact your company in many ways, it’s critical to take your time.
Some business owners make the mistake of borrowing money from a loan shark or hard money lender. It sounds like a reasonable idea upfront, until you find that the terms and conditions are slanted heavily against you.
Rather than make a poor decision that could affect your business for many years to come, turn your attention to the benefits of a term loan. There are hundreds of online and brick and mortar financial institutions that offer these loans, among many other types.
Here are some of the most appealing benefits of a term loan:
Competitive, fixed interest rate: When compared to borrowing from a loan shark, you’ll find that your rate is much lower. This allows you to save hundreds or maybe even thousands of dollars. Furthermore, with a fixed rate, there are no concerns about your payment changing from month to month.
Variety of terms: Term loans typically range from 12 to 84 months, giving you the flexibility to choose the option that best suits your budget.
Fast funding: If you supply everything the lender requires in a timely manner, you’re likely to receive a decision within 24 to 48 hours. If approved, you can sign the final documents and immediately get your hands on the money.
Peace of mind: It’s stressful to enter an agreement with a loan shark, as you never know how they’ll take advantage of you. Not to mention the fact that you put yourself in harm’s way should you be unable to repay the money. Conversely, you’ll have peace of mind when you borrow from a reputable lender.
These are just a few of the many benefits of a term loan for your business. If these pique your interest, contact three to five lenders to learn more about what’s available to a borrower in your position.
Taking out a loan might seem like a quick solution when you’re under financial pressure—but not all loans are created equal. A bad loan, especially from an unregulated or predatory lender, can quickly spiral out of control. What starts as a short-term fix can turn into long-term damage, affecting your finances, health, and future.
What Is a Bad Loan?
A bad loan typically involves unfair terms, excessive interest rates, hidden fees, or a lack of transparency. It might come from an unofficial lender who operates without regulation, often referred to as a loan shark. These lenders prey on people who are vulnerable, desperate, or have limited access to traditional financial services.
The Real Cost of a Bad Loan
1. Crushing Debt That Never Ends
One of the most immediate impacts of a bad loan is the trap of never-ending debt. High interest rates and inflated penalties can mean that even if you make payments, the total amount owed barely shrinks—or worse, continues to grow. What looks like a short-term loan can become a long-term financial nightmare.
2. Daily Stress and Anxiety
The constant pressure to repay a loan you can’t afford can take a serious toll on your mental health. Stress, anxiety, sleepless nights, and fear of what might happen if you can’t pay are common for those caught in these kinds of debt traps. Over time, this stress can impact your relationships, job performance, and overall well-being.
3. Threats and Harassment
When dealing with illegal or aggressive lenders, missed payments don’t result in polite reminders—they can bring threats, intimidation, and harassment. Some lenders may use fear tactics to force repayment, contacting you constantly, turning up at your home, or threatening your family. This can make every day feel unsafe.
4. Damage to Your Reputation
Loan sharks often don’t care about your privacy. If you fall behind on payments, they may contact your employer, neighbors, or family members to publicly shame or pressure you. This can lead to social embarrassment and even problems at work or school.
5. Long-Term Financial Instability
Getting trapped in a bad loan often means borrowing again to keep up. This cycle can destroy your credit, deplete your savings, and push you into more dangerous borrowing. Without a way out, it can become nearly impossible to plan for the future, buy a home, or invest in your goals.
6. Physical and Emotional Health Decline
Living in fear of a lender’s reaction can lead to depression, panic attacks, and even physical symptoms like high blood pressure or illness. The toll of financial abuse doesn’t stop at your wallet—it can break down your entire sense of stability.
How to Know If You’re Dealing with a Loan Shark
Loan sharks often:
Avoid paperwork or written agreements
Charge excessive or unclear interest rates
Insist on cash-only payments
Use threats or pressure tactics
Take personal documents like passports or bank cards as collateral
If any of this sounds familiar, you may be dealing with an illegal lender.
Safer Alternatives to Avoid Bad Loans
If you’re struggling financially, there are safer ways to get help:
Speak to a licensed credit counselor
Explore local community support services or grants
Use legal lenders who are transparent about terms and regulated by financial authorities
Ask for help from family or trusted friends
Create a debt management plan with professional support
You Are Not Alone
If you’ve taken a bad loan, don’t suffer in silence. Many people fall into the same trap. What matters now is finding a safe way out. There are confidential support services and legal protections in place to help people who are being threatened or trapped by illegal lending.
Final Thoughts
A bad loan doesn’t just hurt your finances—it can harm your peace of mind, your safety, and your future. Protect yourself by recognizing the warning signs, staying informed, and knowing where to turn for real help. Taking action today could save you from years of stress, danger, and regret.
It doesn’t matter if you’re applying for your first credit card or have many years of experience using this financial tool, it’s critical to take the necessary steps to protect yourself.
The best thing you can do is review the terms and conditions of a credit card before completing the application. This will give you a clear idea of what you’re getting, what you’re not getting, the benefits, and the potential drawbacks.
Here are some of the more important questions to address:
What is the interest rate? The answer to this question will give you a clear idea of if the credit card issuer is trying to take advantage of you. Although there are regulations in place to keep rates in check, it doesn’t necessarily mean you’re getting what you deserve.
Can your interest rate change? Don’t assume that your credit card has a fixed rate attached to it. If it’s variable, you may find it changing more often than you would like. Also, there may be reasons why your issuer can increase your rate, such as if you miss a payment.
Do you understand the fee schedule? There are fees attached to every credit card, so make sure you know when these come into play. For example, a late fee is charged if you fail to make the minimum payment by the due date. Foreign transaction fees are charged if you use your credit card out of the country. When you understand the potential fees, it’s easier to avoid paying them.
Unlike a loan shark or payday lender, credit card companies must comply with many federal regulations. While this protects you to a certain degree, you could still find yourself stuck with a card that’s not in your best interest.
What process do you follow to review the terms of a credit card before applying? Would you add any other questions to the three above?
Are you facing financial trouble? Are you considering the many ways to obtain funds that will allow you to bridge the gap until things get better?
Many people make the mistake of looking for “fast” money, such as through a payday loan or a relationship with a loan shark. While fast funding is a good thing when you’re facing financial difficulties, you don’t necessarily want to go down this path. Here’s why: you may enter a cycle that’s difficult to break, thus costing yourself more money over the long run.
A personal loan may be the perfect solution for a variety of reasons, including the following:
No collateral: As an unsecured loan, there is no collateral associated with a personal loan. Instead, the final decision is based primarily on your credit history and credit score. If you have a good, very good, or excellent credit score your chance of approval is much greater.
Use the money however you best see fit: Some people use a personal loan to consolidate their debt, such as credit cards and medical bills. Others use the funds to pay for a necessary home improvement project, such as a new roof. As long as it’s legal, you can use the funds from a personal loan however you want.
Competitive interest rate: This is based largely on your credit score, but a competitive interest rate is one of the primary advantages of a personal loan, especially when compared to a payday loan and similar products. A lower interest rate results in a lower monthly payment, as well as less money out of your pocket over the life of your loan.
Adding to the above, it’s nice to know that you can apply for a personal loan online. This goes along with the ability to consult with your local bank about your options.
Don’t make the rash decision to borrow from a loan shark or obtain a payday loan. If you take the time to consider your options, you may soon realize that a personal loan is what you’ve been searching for.
Do you have any past experience with a personal loan? Were you happy with the terms and conditions? Are you interested in this type of loan again?
Are you concerned that you’ve taken on more credit card debt than you can handle? Are you beginning to consider all your options, including some that are less than ideal?
If you answered yes to these questions, take a step back to assess your situation before you make any financial decisions.
For example, you may find yourself gravitating toward a payday loan. This sounds like a great idea, as you’re able to get your hands on the money you need in a timely manner. Not to mention the fact that your credit score and history don’t have any impact on your approval.
But there’s a problem with this: you’ll pay an ultra-high interest rate, all while jumping into a cycle that’s difficult to break.
If you go down the wrong path, your difficult financial situation will become even more challenging in the future.
Fortunately, there’s an answer: a balance transfer credit card.
With this, you can move all of your credit card debt onto a single card. The benefits of this strategy include:
Zero percent introductory rate
Easier management of your credit card debt
Better terms than your other credit cards
When you’re stressed over your finances, it’s easy to make rash decisions and hope for the best. Unfortunately, the best doesn’t always come. Instead, you end up digging a deeper hole.
A balance transfer credit card isn’t the answer to every financial problem, but there are times when it can help you avoid a disastrous situation.
If you’re ready to consider this option, here are some questions to answer:
How much credit card debt do you have?
Is a balance transfer the best way to consolidate your debt and save money?
Are you okay with the idea of paying a balance transfer fee?
After you answer these questions, you’ll have an easier time deciding if a balance transfer credit card can help.
Even if you don’t use a balance transfer to your advantage, avoid payday loans and loan sharks at all costs.
