10. denise took out a payday loan for $300 in august. by february of the next year, she was able to pay back…

10. denise took out a payday loan for $300 in august. by february of the next year, she was able to pay back the loan, but she had spent a total of $750 doing so. whats the most likely story of how this happened? the minimum monthly payment for payday loans is usually only $10 or $15, so a lot of interested accumulated upfront, denise knew there would be $450 of fees attached to the loan, but she took out the loan anyway. payday loans must be paid in full within two weeks, and if not, the only option is to renew the loan for a high penalty fee, which she did approximately 12 times denise not only paid the $300 she owed, but she prepaid an extra $450 in case she needs another loan in upcoming months

10. denise took out a payday loan for $300 in august. by february of the next year, she was able to pay back the loan, but she had spent a total of $750 doing so. whats the most likely story of how this happened? the minimum monthly payment for payday loans is usually only $10 or $15, so a lot of interested accumulated upfront, denise knew there would be $450 of fees attached to the loan, but she took out the loan anyway. payday loans must be paid in full within two weeks, and if not, the only option is to renew the loan for a high penalty fee, which she did approximately 12 times denise not only paid the $300 she owed, but she prepaid an extra $450 in case she needs another loan in upcoming months

Answer

Brief Explanations:

Payday loans typically have short - repayment terms (usually two weeks). If not paid in full, renewal with high penalty fees is common. Denise borrowed $300 and paid $750, a $450 increase. This is likely due to repeated renewals with high fees. The first option about small minimum payments doesn't explain the large increase. The second option about upfront knowledge of fees is less likely as it's not common to knowingly take on such high fees. The fourth option about prepayment doesn't match the nature of payday loans.

Answer:

Payday loans must be paid in full within two weeks, and if not, the only option is to renew the loan for a high penalty fee, which she did approximately 12 times.