Personal Finance Courses: Predatory Lending

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1.
Although people who take out payday loans use them for many different purposes, what is the most common use?
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Regular living expenses. Most borrowers use payday loans for regular living expenses.
2.
What are some things that a payday lender could do if you did not pay back a payday loan you took out?
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All of the above. All of these are possibilities.
3.
A payday lender does not legally have to identify the fees charged to your payday loan.
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False. By law, a lender must spell out all fees to you in your contract.
4.
All credit cards are a form of predatory lending.
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False. Some credit cards have very high fees and other predatory features, but many of them do not.
5.
Which of the following best describes how payday loans differ from bank and peer-to-peer (P2P) loans in terms of repayment time?
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Payday loans must be repaid within weeks. Banks and P2P platforms let you take much longer to pay loans back.