That could work, if ...
You are sure there is no more debt being hidden from you. Loan shark interest can quickly multiply if a few payments are missed.
You are sure that Mrs Owl can resist visiting the Mango Lady when a new sob story comes from her family (gambling debts, car about to be repossessed, etc.),
Make sure that the bank loan conditions include an option to pay off (entirely or lump sum) early or you could be charged whole interest for the agreed period of the loan.
I hope everything works out well for you all.