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Personal Finance Courses: Predatory Lending

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1.
What is a typical fee on a payday loan?
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15%. Fee rates range from 15-20% of the amount borrowed.
2.
You can get a short-term loan from your checking account through what is called _______.
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Overdraft protection. Overdraft protection simply means overdrawing your checking account. You will likely be charged a fee for it.
3.
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.
4.
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.
5.
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.