Test your knowledge

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1.
A payday lender does not legally have to identify the fees charged to your payday loan.
Choose wisely. There is only one correct answer.
False. By law, a lender must spell out all fees to you in your contract.
2.
What do borrowers use payday loans for?
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All of the above. People take out payday loans for many different reasons.
3.
Predatory lending can occur with which of the following?
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All of the above. All of these and many more can be involved in predatory lending. You should evaluate all of them carefully.
4.
If you have a short-term financial emergency, what is a low-cost way to obtain a loan?
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Emergency credit union loan. Many credit unions and banks offer relatively low-interest short-term loans that can help tide you over a short-term financial emergency.
5.
The interest rates of payday loans are very high.
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True. Payday loans have average annual interest rates of 500 percent--or more.