Test your knowledge

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What is a typical fee on a payday loan?

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15%

50%

100%

15%. Fee rates range from 15-20% of the amount borrowed.

To qualify for a payday loan, what must your income be?

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$100 per week

$300 per week

There is no minimum.

There is no minimum. You just need to earn sufficient money to cover the loan.

If you put up a guitar at a pawnshop in return for a loan, what usually happens if you can't pay the loan back?

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The pawnshop can keep the guitar.

Nothing

You get an extra week to pay off the loan.

None of the above

The pawnshop can keep the guitar. This is the general rule for how these loans work.

You can get a short-term loan from your checking account through what is called _______.

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Overdraft protection

A checking account loan

A cash advance

Overdraft protection. Overdraft protection simply means overdrawing your checking account. You will likely be charged a fee for it.

What do borrowers use payday loans for?

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Medical emergencies

Regular bills

As an alternative to other loans

All of the above

All of the above. People take out payday loans for many different reasons.

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