Test your knowledge

Choose wisely. There is only one correct answer to each question.

Keep studying!

Review your answers below to learn more.

A payday loan is designed to _______.

Choose wisely. There is only one correct answer.

Pay off your mortgage

Tide you over until your next paycheck

Provide an open-ended line of credit

Tide you over until your next paycheck. A payday loan is set up to pay short-term bills and to be repaid with your next paycheck.

A payday lender does not legally have to identify the fees charged to your payday loan.

Choose wisely. There is only one correct answer.

True

False

False. By law, a lender must spell out all fees to you in your contract.

Predatory lending can occur with which of the following?

Choose wisely. There is only one correct answer.

Tax refunds

Payday loans

Rent-to-own stores

All of the above

All of the above. All of these and many more can be involved in predatory lending. You should evaluate all of them carefully.

How good does your credit need to be in order for you to take out a payday loan?

Choose wisely. There is only one correct answer.

Excellent

Very good

Average

It doesn't need to be good

It doesn't need to be good. You don't need good credit in order to get a payday loan. Many borrowers do not have good credit.

If you don't pay back your payday loan, the lender could take you to court and sue you for it.

Choose wisely. There is only one correct answer.

True

False

True. Legally, the lender can do that if it wants. Of course, all lenders would rather not have to go that route if they can avoid it.

© Copyright 2024 Precision Information, publisher of the Financial Fitness Group family of products. The trade name Financial Fitness Group and the trademarks Financial Fitness CENTER™, Financial Fitness CHECKUP™ and Financial Fitness ACADEMY™ are exclusive marks of Precision Information, LLC. All rights reserved.