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Personal Finance Courses: Predatory Lending

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1.
If you take out $1000 from a payday lender, a credit card, and a credit card cash advance, which will charge the most interest?
Choose wisely. There is only one correct answer.
The payday lender. By far, the payday lender will charge the most interest. The dollar amount difference between it and the credit cards will be immense. It should be noted that there are also options that are even lower in interest than the credit cards.
2.
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.
3.
If you are behind on a non-payday loan, why should you talk with the creditors about it?
Choose wisely. There is only one correct answer.
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.
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.
Predatory lending can be identified by _______.
Choose wisely. There is only one correct answer.
Its high costs. Predatory lending involves a business charging higher-than-normal costs of various kinds.