PREDATORY LENDING & BANKRUPTCY

Front

Payday lenders often do not practice the underwriting process.

Back

True

Front

True or False:  Predatory lenders target people with good credit scores.

Back

False

Front

True or False: Because payday loans have such high interest rates, they're typically used by high-income households. 

Back

False

Front

The elderly and poor are targets of predatory lending.

Back

True

Front

True or False:  Many short-term lenders realize their borrowers will never be able to pay off their loans on-time, but they still lend anyway. 

Back

True

Front

Which of the following would a predatory lender most likely say? "Thanks for your loan application. We will run a credit check and get back to you within 10-14 business days.", "Hello! We are so glad you are interested in a loan with us! Please complete the application and we will send it to the underwriter for processing.", "Great choice in selecting us to get your some fast funds! Our motto is: "No Credit? No problem!" We can have you some money by tomorrow---at the latest!"

Back

"Great choice in selecting us to get your some fast funds! Our motto is: "No Credit? No problem!" We can have you some money by tomorrow---at the latest!"

Front

Jake takes out a payday loan of $300. In two weeks, he doesn't have the money to repay it in full. Select which options keeps Jake trapped in the cycle of repayment: Jake uses his paycheck to pay the $300, but then immediately takes out another $300 at the same location to pay bills.

Back

Jake uses his paycheck to pay the $300, but then immediately takes out another $300 at the same location to pay bills.

Front

Predatory lending is characterized by underwriting and low interest rates.

Back

False

Front

Negotiating with creditors is an option to consider before declaring bankruptcy.

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True

Front

How do people get trapped in the payday loan cycle?

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Customers may visit several payday loan lenders to get $.