Why Clients Choose refund anticipation loans
Taxpayers choose refund anticipation loans for several reasons:
- Speed: Classic RAL clients receive their loan proceeds on the same day or within 2 days, compared to 8-15 days for direct deposit of their refund into a bank account, or within 6 weeks for mail delivery of their IRS check.
- Convenience: Refund anticipation loans enable clients to pay nothing up front for tax preparation and instead have the fees withheld from the loan amount. In most cases, the client does nothing more to repay the loan, since the bank is repaid automatically when it receives the taxpayer's federal tax refund.
- Cost: Faster access to funds helps taxpayers avoid paying late fees or penalties for overdue bills. For many taxpayers without access to other immediate funds or credit, refund anticipation loans can serve as a less costly option than alternatives that may damage their credit.
