Borrowing safely: United States.

A take-home sheet for people at the session. Other countries: United Kingdom · Canada · Australia.

Moraph for Good · Fluent

Borrowing safely: United States

Handout · moraph.org/commons/sessions/fluent/borrowing-safely

The cost of a loan is everything you pay back, not the monthly payment. This sheet has the questions to ask before you borrow and where to get free help where you live.

Three questions for any lender

What is the yearly rate including fees?
What is the total I will pay back?
What happens if I pay late or early?

Warning signs

Pressure to sign today
No questions about whether you can afford it
A fee before you get the loan, which is often a scam
A lender that wants to keep your ID or bank card

Cheaper options to ask about

Small loans from credit unions or community lenders
A payment plan with the company you owe
Free, not-for-profit debt advice

If you’re struggling

Contact the lender before you miss a payment
Complain in writing, and keep copies
Use the official routes below if it isn’t resolved

In the United States

Lenders must show the APR. The federal Truth in Lending Act requires lenders to give you key loan terms, including the annual percentage rate (APR), before you finalize a loan such as a car loan. The APR includes the interest rate plus certain fees, so compare APR with APR, not with an interest rate.
Payday loans depend on your state. State law decides whether payday loans are allowed, and many states limit their size and fees; some states don’t allow them. Payday lenders generally don’t check whether you can repay while meeting your other bills.
Wages and court orders. A payday lender can only garnish your wages if it has a court order.
Servicemembers. Under the Military Lending Act, active-duty servicemembers and their dependents have extra protections on payday and other consumer loans, including a 36 percent cap on the Military Annual Percentage Rate.
Complaints. You can submit a complaint about a lender to the Consumer Financial Protection Bureau, which sends it to the company. Companies generally respond within 15 days.

Official places to check:

Consumer Financial Protection Bureau: www.consumerfinance.gov/ask-cfpb/what-is-the-difference-between-a-loan-interest-rate-and-the-apr-en-733
Consumer Financial Protection Bureau: www.consumerfinance.gov/ask-cfpb/what-is-a-payday-loan-en-1567
Consumer Financial Protection Bureau: www.consumerfinance.gov/consumer-tools/payday-loans
Consumer Financial Protection Bureau: www.consumerfinance.gov/complaint

General information, not advice about your own situation. Checked 19 October 2026. If an official source says something different, it is right. Free to copy and adapt. moraph.org/commons/sessions/fluent/borrowing-safely