Another alternative to payday loans is a short term loan product offered by Fifth Third Bank. The interest rates are much lower than a traditional payday loan, however the product is still expensive. The lender recommends that this product only be used in an emergency situation. Fifth Third has rolled out the product nationwide to customers. The product being offered fully complies with all applicable federal and state government banking regulations.
The Fifth Third Early Access loan product is a line of short term credit that allows qualified customers to quickly and easily borrow money from their next direct deposit at rates that are lower than some alternatives. The funds borrowed are deposited directly into the customer’s, checking account, so the borrower can immediately use the money as they wish.
The advance offered is less expensive than a payday loan. The maximum amount loaned by the lender will be $500. The product comes with an APR of 120 percent, and APR is the cost of credit provided as a yearly rate. So the APR is still very high, but it is much better than a payday loan, which can have an APR of 300 percent or higher.
The bank knows that this product is not for everyone, so in attempt to stop customers from abusing it, or running up large amounts of debt, the advances are only being offered to existing customers with checking accounts in good standing.
Also, if a customer does not repay the advance timely, the repayment will automatically occur, which should also limit risk to a borrower. The repayment on the advance from Fifth Third comes when your next direct deposit of at least $100 hits your account. If that does not occur, then the lender will automatically withdraw the amount that is due at 35 days if no direct deposit has come into the customers account.
Other terms of the so called checking advance products offered by Fifth Third include the following.
-The process required to begin the loan program has been streamlined. No application is required in order to use the Early Access loan product.
-The maximum credit limit provided to customers will be $500 or 50% of total monthly direct deposits, which will be based upon a 3 month average. This will also be rounded up to the next $20 increment, whichever is lower.
-Customers get immediate access to the funds to pay bills or expenses, as once they take an advance, funds are available immediately to the borrower and are deposited in their account.
The short term loan product is currently only offered to Fifth Third customers in Indiana, Ohio, Florida, Kentucky, Michigan, Missouri, Illinois, and Tennessee. To learn more or apply for the Firth third Bank Early Access loan product, call 1-800-972-3030.
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