Exploitative Lending Practices

Exploitative lending practices occur when lenders take advantage of borrowers through unfair or deceptive terms, often by charging excessively high interest rates, hidden fees, or imposing strict repayment conditions. These practices can trap individuals in a cycle of debt, making it difficult to repay the loan and causing financial hardship. Such practices are unethical and sometimes illegal, as they prioritize lending profits over the borrower's well-being. Recognizing these, regulators and consumer advocates work to promote fair lending standards and protect consumers from predatory behavior.