Even if your credit is bad, shop around and be sure to include a credit union and a bank that makes both prime and subprime loans on your list.

Extra short loan term
Often with a payday loan, the entire loan (interest and principal) is due very quickly, says Fox. That means the borrower will be borrowing again just to keep pace with the debt, creating a never-ending cycle.

Major asset as collateral
It may seem obvious that car-title lenders and pawn shops are a gamble because you risk losing the item if you can't come up with cash you already don't have. But consumers think nothing of putting their houses on the same block with a home equity loan or line of credit. "The worst are home equity second mortgage loans, all of the loans that are secured by the roof over your head," says Fox.

Mandatory arbitration clause
What is this? By signing for the loan, you're giving up any right to sue for any reason and instead agree to binding arbitration. The problem: Many consumer advocates believe that arbitrators' decisions tend to favor the lenders and deny borrowers the right to due process.

Some of the big lenders are moving away from arbitration clauses, says Fishbein. But they're still around in the subprime market.

"This should be freely entered into at the time of dispute, not as a condition for obtaining the loan," he says. "By agreeing to this provision if a dispute should arise, the table is tilted toward the lender."

Prepayment penalties
For the borrower, this fee "adds to the cost of credit," says Fishbein. Reason: If your financial situation or credit improves, you can't refinance your loan at a better rate. "It's one of the features we find particularly bothersome in subprime loans," says Fishbein.

Some credit experts advise avoiding prepayment penalties altogether. Others caution that one year is fine. Still others recommend keeping it to three years or less.

Prepayment penalties also increase the odds of foreclosure, says Stegman. In his study of subprime refinance loans, consumers with prepayment penalties of less than three years had a 15 percent higher rate of foreclosure. With three years or more, the numbers went to 20 percent.

And make sure the loan doesn't use the Rule of 78 to calculate interest. It's an antiquated method and "a hidden prepayment penalty," Fox says. What you want to see instead: the word "actuarial." That means "you pay for credit for the actual length of time you use it," she says.

Balance transfer fees
"Depending on how much you're transferring, it can be a lot of money," says Garcia. "It's something that's really easy to overlook and can cost you hundreds of dollars."

Lender solicitation
This occurs when a lender approaches you with a loan offer instead of you seeking out the lender. Face it, you get the best terms when you shop around and compare. If you're just accepting what was offered, you probably could do better.