Quiz – Escaping Debt Traps

Question 1 of 6

1. Question

Payday loans can charge annualized rates exceeding:

400 percent

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40 percent

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100 percent

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20 percent

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Question 2 of 6

2. Question

According to the CFPB, predatory lending traps about how many Americans each year?

12 million

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1 million

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100 million

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500 thousand

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Question 3 of 6

3. Question

A credit card spiral occurs when:

Minimum payments barely cover the interest

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You pay the full balance each month

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The card has no interest at all

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You never use the card

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Question 4 of 6

4. Question

Which is a legitimate escape strategy named in the capsule?

Debt consolidation and nonprofit credit counseling

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Taking another payday loan

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Using buy-now-pay-later for everything

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Ignoring your statements

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Question 5 of 6

5. Question

Match each trap or tool to its description.

Sort elements

Rates exceeding 400 percent
Minimum payments cover only interest
Hidden fees obscure true cost
A legitimate escape route

Payday loans

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Credit card spiral

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Buy-now-pay-later

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Nonprofit credit counseling

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Question 6 of 6

6. Question

Fill in the blanks.

Payday loans can charge over Fill in the blank 1 of 3 percent annually, and a credit card Fill in the blank 2 of 3 happens when minimum payments only cover the Fill in the blank 3 of 3 .