The term "predatory loan" refers to a number of practices that exploit consumers and can result in the loss of homes and life savings. Predatory lending practices include both technically legal but high-cost loans and outright fraud through deceptive sales practices. A common element of all predatory lending practices is aggressive marketing to economically vulnerable groups such as elderly and low-income consumers and those with poor language skills. Common types of predatory loans include high-interest, high-fee mortgages; high-cost check-cashing services; payday loans; and car title loans.
We would like your feedback on this Personal Finance Frequently Asked Question.
