Some major banks will no longer offer advances that are payday-like

Some major banks will no longer offer advances that are payday-like

A Wells Fargo bank in W dbury, Minn. (Picture Karen Bleier, AFP/Getty Pictures)

The high-cost, quick-fix deposit advance loans made available from some banking institutions are going to be discontinued in 2014 after customer advocates dubbed the merchandise as debt traps.

Both Fifth Third Bank and Wells Fargo, which had customers in Michigan, will put limits on new customers enrolling in deposit advance products as of Saturday.

Current clients may have much more time and energy to make use of loans that are such the credit items are eliminated, but customers still must get ready for modification ahead.

A deposit advance is a loan that is small-dollar frequently for approximately $500 or less, that is marketed as one thing to have your money away from a jam. In order to obtain an advance, clients will need to have direct deposit of the paycheck or other income to a bank checking account or card that is prepaid.

The deposit advance is frequently paid back because of the next direct deposit. The lender is actually compensated first before virtually any bill payments. Continue reading “Some major banks will no longer offer advances that are payday-like”