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Personal Finance Courses: Predatory Lending

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1.
Predatory lending can be identified by _______.
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Its high costs. Predatory lending involves a business charging higher-than-normal costs of various kinds.
2.
It is possible to pay more in fees on a payday loan than the amount you originally borrowed.
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True. If you extend the loan or take out a different one to cover it, and you did this several times in a row, you might actually pay more in interest than the actual loan itself.
3.
How good does your credit need to be in order for you to take out a payday loan?
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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.
4.
How long do most payday loans last?
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Two weeks. Most payday loans last about the length of a pay period, which is two weeks.
5.
If you are behind on a non-payday loan, why should you talk with the creditors about it?
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They would rather work with you than have to sell your loan to a debt collector. If they sell your loan to a debt collector, they will get very little for it. They WANT to work with you rather than see that happen.