Test your knowledge

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How soon after receiving your funds from a payday loan can you spend the money?

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One week

You must wait until the next morning

You must wait 24 hours for the application to clear

Right away

Right away. You may spend the money as soon as you want.

The interest rates on payday loans are _______.

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Higher than those of banks or credit unions

Lower than those of banks or credit unions

Normal

Higher than those of banks or credit unions. Interest rates on payday loans are generally much higher than those of other loans.

What are some things that a payday lender could do if you did not pay back a payday loan you took out?

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Turn your loan over to a debt collector

Sue you

Repossess your property that you put up as collateral

All of the above

All of the above. All of these are possibilities.

It is possible to pay more in fees on a payday loan than the amount you originally borrowed.

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True

False

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.

When you take out a payday loan, how long is the grace period for paying it back?

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Two weeks

One month

Two months

There is no grace period.

There is no grace period. Payday loans do not offer grace periods; you must pay them back on your payday or you will be charged late fees.

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