Question

Possible actions that may signal predatory lending include

a) Providing clear loan terms and conditions
b) Conducting thorough credit checks
c) Offering fixed interest rates
d) Imposing excessively high fees and interest rates

Answer 1

Predatory lending is indicated by actions such as imposing excessively high fees and interest rates, as opposed to responsible practices like clear loan terms and conducting credit checks.

Step-by-step explanation:

The actions that may signal predatory lending include imposing excessively high fees and interest rates. Clear loan terms, conducting thorough credit checks, and offering fixed interest rates are generally regarded as responsible lending practices. In contrast, predatory lending is characterized by unfair, deceptive, or fraudulent practices during the loan origination process, often leading to terms that are abusive or make repayment onerous for the borrower.