Predatory Lending

The phrase predatory lending is sometimes used to describe the many types of illegal activities in the loan industry. It is also used to describe unfair and abusive lending practices. An example of predatory lending would be any short-term loan that has a disproportionally high fee - such as a payday loan or car title loan - where the fee paid works out to an annual interest rate that is significantly higher than the market rate for the majority of high-risk loans.