Question
What is a potential consequence of taking a predatory loan? 1. Borrowers can easily repay the loans without any financial strain. 2. Borrowers may get trapped in a cycle of debt by rolling over toans. 3. Borrowers receive financial counseling to improve their credil score. 4. Borrowers are given grants to pay off the loans.
Solution
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Myles
Expert ยท Tutor for 3 years
Answer
The correct answer is 2. Borrowers may get trapped in a cycle of debt by rolling over loans.Predatory loans often have high interest rates and fees, making them difficult to repay. Borrowers may find themselves needing to take out new loans to pay off existing ones (rolling over), which only digs them deeper into debt. The other options are not typical consequences of predatory loans and often represent the opposite of what actually occurs.