STANDING at the school gate Michelle was approached by a friendly mum wanting to be mates – but by Christmas she was homeless after falling for a loan shark trap.
Mum-of-three Michelle, whose name we have changed to protect her identity, had recently moved to the area after escaping an abusive relationship.
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Because of that, she was initially wary of new friends, but the friendly mum at the school gate was determined.
Soon they were meeting up regularly for a cup of tea and, thought Michelle, were close friends.
Michelle said: “Now I think they just spotted that I was a single mum and a loner.
“And by Christmas I couldn’t even put up a tree for the kids or have a dining table to do them a Christmas dinner.
“I had a good job, I came from a good background, and I was still a victim. It could happen to anyone.
Hundreds of thousands of people are in debt to illegal money lenders in the UK, campaigners warn – and Christmas is the second most common reason for borrowing cash.
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When Michelle was struggling to afford a birthday present for her son, her new friend offered to lend her some money.
“I’m not the sort of person to borrow money, but I had got to the point where I was really struggling,” Michelle told The Sun.
“She was my friend and she wasn’t judging me, so I thought it wouldn’t do any harm.”
Michelle knew her friend gave money to people and charged them interest – but she was promised there were no extra costs as they were mates.
Initially she borrowed £100 – but the next month, when Michelle was short again, she borrowed more money and this time there was interest to pay.
She borrowed £100 and agreed to pay back £250 – paying off £50 a fortnight until the debt was repaid.
That’s equivalent to an interest rate of around 1,000 per cent. For comparison, the average interest rate on a £3,000 loan is currently less than 10 per cent.
When Michelle’s hours were reduced at work, it got harder to pay back the cash: “She said I’d have to repay double what I’d borrowed at the end of the month, and then there was just no way out.
“Each month I had to borrow more to make up the shortfall.”
The most she borrowed at one time was £350, and she repaid nearly £2,500.
The loan shark even knew the date she got paid, so knew when to chase for the money.
I was embarrassed and ashamed
Soon the repayments had gotten out of control and Michelle told her friend she couldn’t afford the interest rate.
“That ‘s when it started to get nasty,” she said.
“There were a lot of threats – she said she knew people and she would use other people to threaten me.
“They would send me messages or throw things at my windows, shouting things at me outside the house.”
Local youths threatened Michelle with violence, made threats to harm her family and smashed her windows.
Crooks from the gang broke into her home, burgled it and urinated over her children’s bedrooms.
Michelle said: “It escalated quite quickly. What they didn’t take, they destroyed.
“I was scared for my life and my children.”
Eventually, Michelle packed up the family’s few remaining possessions and left.
But she still received messages and public attacks on social media from the loan shark and the loan shark’s associates.
They told mutual friends not to speak to Michelle because she couldn’t pay her debts.
Michelle said: “It was almost worse than the physical attacks, because my friends and family saw it and I was worried about a future employer seeing the posts.”
The family found themselves homeless just before Christmas, and luckily they were able to secure temporary accommodation from the council.
But there were no presents, no decorations, no tree and not even a TV.
Michelle said: “It was Christmas and I couldn’t even put up a tree for the kids or have a dining table to do them a Christmas dinner.”
Desperate and worried, Michelle started researching about owing money to friends and stumbled across the website StopLoanSharks.
She said: “You say loan shark and you think of burly men coming to your door with a baseball bat, not a mother at the school gate.
“I never asked many questions about where her money came from – maybe in my heart of hearts, I knew she was a loan shark, but I didn’t have any other means and couldn’t have gotten a loan from anywhere else.”
“I was embarrassed and ashamed – I hadn’t told anyone because I felt like I’d let my children down and got myself into this awful situation where I’d had to flee my own home.”
Michelle worked hard to get the posts about her removed from social media and set about rebuilding her life.
She said: “We can have a wonderful Christmas this year. The kids are doing well and have everything they need, and I can be proud of myself and what I have achieved.”
What to do if you’re a loan shark victim
Families are being urged not to turn to loan sharks this Christmas as many people struggle to cope with soaring costs.
The festive period is a prime time for loan sharks to target victims as families often overstretch their budget to provide a memorable Christmas.
But borrowing money from anyone other than a regulated company could bring devastating consequences.
If you owe money to a loan shark, t’s important to let people know what’s going on including friends and family, your local council and police.
Cath Williams, liaison officers at Stop Loan Sharks, said: “The hardest thing is getting people to speak out – it takes people a long time to get to that point of despair and get the courage to come to us.
“But there are people who can help you and do everything in their power to get you out of the situation – be brave and speak out.”
StopLoanSharks investigates and prosecutes illegal money lenders and provides support for victims.
It estimates that there are at least 310,000 people in debt to illegal money lenders in the UK.
Since 2004, the England Illegal Money Lending Team has helped more than 30,000 people and written off £87 million worth of illegal debt.
The IMLT has the power to investigate and prosecute loan sharks and illegal money lenders.
For victims, it will appoint you a Liaise Officer to support you through the process – information can be given anonymously too.
How to spot a loan shark
Be wary of anyone offering you money, particularly if there are no specific terms or there is no documentation of the loan.
Around two-thirds of people think a loan shark is a friend at the time they borrow the money, according to StopLoanSharks.
Williams said: “The biggest warning sign is anyone who seems to be lending to lots of people, especially without any paperwork or it’s very vague.”
But it might not be a friend or someone you know.
Since the start of the pandemic, loan sharks have increasingly used social media to operate.
Many people now borrow money through Snapchat, TikTok or Facebook without ever having met the lender.
You can contact StopLoanSharks through its website or on 0300 555 2222.
If you are in immediate danger contact the emergency services on 999.
If you are worried about debt, there are charities that can help such as Citizens Advice, StepChange and National Debtline.
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