Home
/
Business
/
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.

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.

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

expert verifiedExpert Verified
4.5(154 Voting)
avatar
MylesExpert · Tutor for 3 years

Answer

The correct answer is 2. Borrowers may get trapped in a cycle of debt by rolling over loans.<br /><br />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.<br />
Click to rate: