Activity 4: Difficulties Getting a Business Loan

Students will read Document 7, "In Some Immigrant Enclaves, the Loan Shark is the Local Bank," from The New York Times, April 23, 2001. They can read parts of the article in class and discuss the following questions.

Vocabulary and concepts: interest rate, prestamista, bodega, collateral

What is a loan shark? Why do many Latinos turn to them for money?

Have your parents needed to take out loans? What did they need them for? Was it difficult to get the loans? Where did they get them?

How much interest do loan sharks typically charge? How much interest does a commercial bank charge?

What other immigrant groups depend on loan sharks? Why do you think this is the case?

Why are some Latinos reluctant to use regular banks? Why are there fewer banks in poorer neighborhoods?

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