Small business owners who feel they have been charged improper interest or fees by Advanta can consider seeking remedy in small claims court.

I want to be clear that we're not in the business of giving legal advice. Business owners should talk to their lawyers about something like this. But we've fielded a lot of comments from Advanta customers whose credit card rates were drastically raised, and this hasn't come up yet.

Many people want to know whether they should cash the checks that went out this week under Advanta's settlement with the FDIC. By cashing the check, which is supposed to be restitution for two months' worth of excess interest charges, a borrower releases Advanta from future liability. But many business owners still have balances of thousands of dollars, accumulating interest at 30%+ APRs. The average restitution check for $131 won't help much.

Last night I spoke to Alan Finkel, a Long Island attorney who is involved in the lawsuit against Advanta in California. Finkel is a divorce mediation attorney who was an Advanta customer himself. He helped organize the suit in California (because it's a more favorable jurisdiction for this type of action), but other attorneys who specialize in this kind of case are leading the litigation. We've posted the complaint here. Advanta declined to commment on the suit.

Finkel himself says he plans to hold off on cashing his restitution check and pursue a claim in New York small claims court. (He's not a plaintiff in the California action.)

There are lots of questions still to be settled about the California lawsuit. It could be moved to a different state, or to a federal court. It has not yet been certified as a class action (although this determination could be made in the coming weeks). If the court certifies it as a class action, it's not clear whether it would be restricted to Advanta customers in California or nationwide. And even if there is an eventual settlement or award of damages, it's not clear how much money plaintiffs would see. There's also the question of whether Advanta will still exist or have any money left to pay out.

Some borrowers have filed other individual lawsuits against Advanta. Suing in civil court is usually expensive and time consuming, but if the amount of damages borrowers seek is under a certain limit (generally somewhere between $3,000 and $10,000), they may be able to file a much simpler claim in small claims court. The limits and rules vary for each state. (Here's a useful guide to the state small claims courts, and here's a primer on bringing a claim.)

Please keep the comments and emails coming. Your participation has been crucial to reporting this story. If any readers have taken Advanta to small claims court, let us know what your experience was.

Also, I asked Advanta about their policy for renegotiating rates, after many commenters have observed that the company seems to negotiate only with customers who stop payments. For what it's worth, here's Advanta's non-answer: "The facts and circumstance of each customer are unique to that customer. Customers with questions about their account should call our customer service area at (1-800-705-7255) to discuss their specific questions."

The big question is why the FDIC settlement was such weak medicine. Seems like a fair resolution would have at least included an order to lower the jacked up APRs and forgive the excess interest, if not restitution for the interest already paid.