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Personal Finance Courses: Predatory Lending

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1.
As a general rule, which of the following will charge the LEAST amount of interest if you take out a loan?
Choose wisely. There is only one correct answer.
A loan from a bank or credit union. As a rule, these loans have the lowest interest rates and charge the least amount of interest.
2.
You can get a short-term loan from your checking account through what is called _______.
Choose wisely. There is only one correct answer.
Overdraft protection. Overdraft protection simply means overdrawing your checking account. You will likely be charged a fee for it.
3.
All credit cards are a form of predatory lending.
Choose wisely. There is only one correct answer.
False. Some credit cards have very high fees and other predatory features, but many of them do not.
4.
To qualify for a payday loan, what must your income be?
Choose wisely. There is only one correct answer.
There is no minimum. You just need to earn sufficient money to cover the loan.
5.
Although people who take out payday loans use them for many different purposes, what is the most common use?
Choose wisely. There is only one correct answer.
Regular living expenses. Most borrowers use payday loans for regular living expenses.