No longer is there a man smoking a big cigar, wearing a white shirt with his sleeves rolled up to his elbows and a clip on tie, picking and choosing who he'll lend money to next. Unfortunately, people believe that it is still as difficult to get a loan as it once was. This fear of banking loan officers led some people to seek out a more certain alternative to meeting their financing objectives. Unfortunately, the alternative is usually not the best one. Some people are so stressed about meeting banking loan officers, and are so sure that they'll be refused a loan, that they'd rather skip the whole process and jump right into dangerous waters with loan sharks.
Loan sharks lend everyone money at exaggerated interest rates.
They charge the good customers a high interest rate to cover for everyone, and instantly seize all collateralized assets of those that default on their payments. It's a win-lose situation for the loan sharks and borrowers respectively. These same good borrowers could have gotten their loans from the bank at a much lower rate if only they weren't so intimidated by the institutions. The extravagant life of a loans officer, where people would line up outside the office to request a loan, is over. Now, more than ever, loan officers are starting to feel the pressures of finding new customers.