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|Fifth Third Bank Easy Access Loan Class Action Lawsuit|
- Wednesday, 22 August 2012 03:00
Fifth Third Bank Easy Access Loan Class Action Lawsuit
By Kimberly Mirando
Fifth Third Bank charges illegally high interest for “payday” loans – sometimes over 1,000 percent, according to a class action lawsuit filed in federal court.
Plaintiffs in the class action lawsuit claim they were charged outrageous interest rates for Easy Access loans, which are essentially paycheck advances. Through this program, the customer obtains a short-term loan that is directly deposited in their checking account. Fifth Third Bank charges a 10 percent fee that is taken out of the customer’s next paycheck before it is direct-deposited. Fifth Third also takes the loan amount out of the paycheck, as long as the next direct deposit is at least $100.
When added together, Fifth Third’s fees amount to interest with annual percentage rates that can top 1,000 percent, the class action lawsuit alleges. Ohio law limits banks to a maximum 25-percent annual interest rate on loans.
Fifth Third bank has attempted to skirt this law by calling the money it takes out “transaction fees” rather than an “interest rate,” the lawsuit claims. According to its website, the Early Access program fees come to a 120 percent annual rate when paid back in a month.
“We show the annual percentage rate (APR) for Fifth Third Early Access so our customers can compare the cost of using this product against other forms of credit, but there is no interest charge associated with an advance,” Fifth Third said on its website. The bank also warns customers that the loan program “is an expensive form of credit.”
The Fifth Third Bank Easy Access Loan Class Action Lawsuit is brought on behalf of all people who received Early Access loans and repaid them within 30 days. It is asking the bank to pay back all the excessive interest charges it charged to customers.
Updated August 22nd, 2012
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Last Updated on Thursday, 27 December 2012 11:09