Slog - Comments on So, That Horrible Bill I Was Talking About...

Comment by Will in Seattle

Will in Seattle — Wed, 30 Jan 2008 13:43:54 -0800

Of course it's a horrible bill.

But, what are you going to DO about it?

Comment by Bellevue Ave

Bellevue Ave — Wed, 30 Jan 2008 13:49:36 -0800

the proper way to do the tax refund loans is to automatically deduct the interest out of the lump sum payment. i havent ever met anyone who has received one of these nor gotten one myself but I hope that is how they currently work.

Comment by Trey

Trey — Wed, 30 Jan 2008 13:51:29 -0800

The last thing that people who "need" loans actually need is an easier way to get a loan. From a personal finance perspective, you should never "need" a loan - you should get a loan when you can afford to carry the debt, and when carrying the debt actually makes financial sense (as opposed to paying for whatever-it-is-you-want with cash you already have on hand).

Comment by Bellevue Ave

Bellevue Ave — Wed, 30 Jan 2008 13:54:51 -0800

of course any financial tool that fights to have itself be cashed at a 7-11 already seems like a bad idea to begin. you cant buy stock at 7-11, you cant buy a house at 7-11, you cant take out a small business loan at 7-11, but you can send money western union...
think about it

Comment by Greg

Greg — Wed, 30 Jan 2008 13:56:34 -0800

Whoo! Let's get out there and screw over some poor people!

Comment by COMTE

COMTE — Wed, 30 Jan 2008 13:58:48 -0800

Anyone who is in such desperate straights that they need to take out a loan on a tax refund they'll receive in just a few weeks (depending on how they file, AND if they have a checking or savings account), is simply prey to a predatory lender; and that's all these things are - predatory.

Why, if companies like H&R Block (which, as a volunteer tax preparer, I would NEVER send anyone to in the first place) are so concerned for the well-being of their customers, can't they simply set up a system whereby they loan the refund amount, MINUS A REASONABLE INTEREST PAYMENT of say, 6% or 7%, and have the IRS send THEM the refund directly?

I assume one of the rationalizations they use for charging high interest rates is the potential for defaults or non-reimbursement, since of course, all poor people are evil, scheming, cheats, right? But, if the refund goes directly to the lending institution, that would pretty much solve that problem, and there'd be no justification for charging egregeiously high interest.

Oh, of course. I sometimes forget. These guys aren't in business to be helpful to their clients, but rather to squeeze them like a sponge full of money.

Comment by Bellevue Ave

Bellevue Ave — Wed, 30 Jan 2008 13:59:06 -0800

this seems like a business opportunity for someone to undercut H&R Blocks rates on these loans and offer lump sum at % below refund amount.

Comment by vooodooo84

vooodooo84 — Wed, 30 Jan 2008 14:01:38 -0800

so i am going to hand my tax return over to the 7-11 clerk? that is just insane.

Comment by Bellevue Ave

Bellevue Ave — Wed, 30 Jan 2008 14:16:01 -0800

well said comte; I can't fathom for the life of me how the company that prepares taxes can't have an arrangement made that the refund goes to them, the lump sum goes to the customer minus a 7% fee or something.

Comment by wondering and wandering

wondering and wandering — Wed, 30 Jan 2008 14:53:35 -0800

Josh, you're obviously an intelligent, thorough reporter, but man back off on those boring pills.

Comment by Fnarf

Fnarf — Wed, 30 Jan 2008 17:50:08 -0800

Boring? This is seriously bad news. I can't believe Tamiko Santos is behind this. I'm shocked.