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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 is a typical fee on a payday loan?
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15%. Fee rates range from 15-20% of the amount borrowed.
3.
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.
4.
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.
5.
Which of the following are you forbidden to spend payday loan money on?
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You are not forbidden to spend payday loan money on anything. There are no restrictions on what you can spend payday loan money on.