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During tax time I see all kinds of companies that advertise about paying you in advance for your income tax refund check. It seems like these are OK deals until you get out your trusty old calculator.
I bet you thought loan sharking was illegal didn't you? Well, I thought so too until I did the math on something that so many people fall for.
Several of the well-known income tax preparation services offer these advance loans, so they seem legitimate. However, the amount of cash charged to receive your loan back a few days sooner is outrageous and should be criminal!
According to a report by the National Consumer Law Center, refund loans cost the average person using them anywhere from 50 to 500 percent interest!
To receive a loan on a refund; the average consumer will pay a refund account fee and a bank fee, as well as a fee for the tax preparation. Because most of these tax filings are simple, taxpayers could e-file and use the additional $70-$150 themselves.
But either way, to pay a 500% interest rate on those funds, when just waiting a few weeks would eliminate this highway robbery, is probably not in your best interest. If somebody you know is getting ready to do this, let them know what you know now.
I am always looking to do what is in your best interest. Anytime you need some honest answers, or accurate information, just give me a call or drop me an email.
Oh, by the way, many of you have been thinking about the buyer's market out there; don't wait too long to get a piece of the pie! Now really is the time to take a look at it.
If the price of your home falls, you lose your option to even think about doing it. Let's at least just see what your options are. It will cost you nothing to review your options, and options are a wonderful thing!
I look forward to talking with you soon!
Sincerely,
Ken
951-760-3833
www.KenHallFinancialGroup.com
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