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Personal Finance Courses: Predatory Lending

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Choose wisely. There is only one correct answer to each question.

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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.
If you are behind on a non-payday loan, why should you talk with the creditors about it?
Choose wisely. There is only one correct answer.
They would rather work with you than have to sell your loan to a debt collector. If they sell your loan to a debt collector, they will get very little for it. They WANT to work with you rather than see that happen.
3.
Which of the following are you forbidden to spend payday loan money on?
Choose wisely. There is only one correct answer.
You are not forbidden to spend payday loan money on anything. There are no restrictions on what you can spend payday loan money on.
4.
The interest rates on payday loans are _______.
Choose wisely. There is only one correct answer.
Higher than those of banks or credit unions. Interest rates on payday loans are generally much higher than those of other loans.
5.
When you take out a payday loan, how long is the grace period for paying it back?
Choose wisely. There is only one correct answer.
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.