How Does A Pitch For A $3,000 Advance On Your Tax Refund Turn Into $500?

By Susan Tompor
Detroit Free Press

WWR Article Summary (tl;dr) As columnist Susan Tompor points out, if you’re owed a $3,000 tax refund, there’s no way you’re getting a $3,000 refund advance loan. Yet the big number is what consumers will see first.

Detroit Free Press

People who are looking for fast cash to pay holiday bills, unexpected car repairs or skyrocketing heating bills are being bombarded with TV ads, window signs and other pitches for tax refund advances.

Actor Jon Hamm, wearing bib overalls, laments being stuck after his old truck breaks down in a Dust Bowl setting in an H&R Block commercial.

“There’s got to be a way to get us some money fast,” Hamm’s character says. “If only there was some kind of advance we could get on our tax refund.”

The pitch is tempting, especially when the commercial says up to $3,000 could be available in an advance.

Jackson Hewitt, which has its own refund advance product, noted that 43 percent of millennial taxpayers polled indicated in a recent survey that they plan to use their tax refund to pay holiday debt, compared with 31 percent of the general population.

The refund loan products are relatively new. Consumers must dig into the details to understand what kind of loan they might expect and exactly what’s being offered.

The advance loans are made by banks, and secured by and repaid directly from a consumer’s tax refund. As a result, the size of the loans will be limited.

So if you’re owed a $3,000 tax refund, there’s no way you’re getting a $3,000 refund advance loan. Yet the big number is what consumers will see first.

Through Feb. 28, a 0 percent interest loan for up to $3,000 is being offered to current and new customers at H&R Block. If approved, H&R Block says, clients will typically have access to money the same day they apply.

Related News

Leave a Reply

Your email address will not be published. Required fields are marked *