Quote:
Originally Posted by ToothSayer
"What you hear" is really interesting. I always assumed the loan sharks were for desperate people or gamblers, but I guess is makes little sense to lend to desperate people or gamblers. I never imagined you could put together an honest (if not legal) loan sharking business.
No one wants to lend money to people who can't repay them. The best business is reliable business. If someone is trustworthy and simply needs to buy time (and really, that's what loansharked money is - buying time), of course you lend them the money at a ~150% annualized rate. Letting someone borrow 10k and making 3k profit in ten weeks is great. You literally make 300 dollars a week profit for doing nothing, and both parties are happy because the borrower fixed his problems by paying a fee which helped him out in a tight spot. Most people who go to the street for money need it immediately, and good loansharks always have funds available.
Desperate people are fine as long as they have assets or collateral. True deadbeats, like someone who wants to borrow the money and try to gamble their way out of debt and have no assets, are mostly shunned. Even if they are scared of you, if they can't pay you, they simply can't pay you. They are to be avoided.
It's all very civil when trustworthy people are involved. It's just business.