Still a Bad Idea, Just Not Totally Awful
H&R Block is cutting its refund anticipation loan fees, with strings attached:
The largest U.S. tax preparer said it is reducing by more than 60 percent the typical rate on refund-anticipation loans (RALs). These are short-term cash advances made to customers who expect refunds after H&R Block prepares their tax returns.
Under the new fee schedule, a typical $2,800 refund loan might cost as little as $60, so long as customers open H&R Block bank accounts and arrange for refunds to be deposited directly into them.
H&R Block said this equates to a 36 percent annual interest rate, in line with what consumer advocates suggest. It said this is below the 93 percent effective rate it might have charged before, and the 103 percent that rivals might charge.
They’re still a bad deal. Avoid them.
