You have seen the commercials. “Do your taxes here and get your refund in minutes.” Not so fast now. A friend of mine went to a popular tax service to get up to a thousand dollars based on their 2009 estimated tax refund. My friend was getting back almost 5,000 dollars. Excited and happy that this was their estimated tax refund, my friend couldn’t wait to get a thousand dollar refund anticipation loan. My friend, who had good credit didn’t qualify. They didn’t even qualify for a 50 dollar refund anticipation loan.
So what was the problem? The problem is that the bank that issues the RAL or refund anticipation loan tightened the restriction on getting the loan. That means that the thousands of people that want to get refund anticipation loans are going to get denied because of the current economic situation.
The banks just got a 750 million dollar bailout but they don’t want to loan out any of that money. I think they are sitting on the interest.
So if you plan on getting a refund anticipaion loan from your favorite tax preparer, don’t get too excited. If my friend has good credit and couldn’t get one of the easiest loans, then you probably won’t get one either.
The only places offering any loans, believe it or not, are payday loan establishments.