Tax filers in African-American communities 3.5 times more likely to use high-cost loans to get refunds

These high-cost, short-term loans secured by a taxpayer’s projected tax refund are arranged by for-profit tax preparers in partnership with large banks as a quick alternative to receiving a refund directly from the IRS through a paper check or direct deposit to a bank or credit union account.

Refund anticipation loans continue to disproportionately impact communities of color

Woodstock calls on federal banking regulator to scrutinize tax refund lending

Written by Administrator on September 3, 2008 - 2:00am

Republic Bancorp, one of a handful of banks making high cost tax refund loans through paid tax preparers throughout the country, has submitted an application to change regulators, raising concerns of consumer advocates throughout the country.  In the Chicago region, 38 percent of all Earned Income Tax Credit recipients are using these tax refund anticipation loans to get their refund.  With interest rates often in the triple digits, this product costs low


Subscribe to RALs