On banks making a killing with overdraft fees

[cubby1223]

What is wrong with you people? They charge overdraft fees. Solution is to not overdraft your account.

It's just so tiring to continue to read that the fees are all pure "profit" and therefore evil. Go out and live in the real world someday. Those fees pay the salaries of the employees, keeps them in a job, something that we're running out of in this country. Those fees pay for the taxes the business has to pay to the government, something the government is also running out of these days. Those fees pay for their expenses, like the electricity so you have a place to go to when you need to use their services.

Remember how banks *used* to operate? General monthly fees, ATM fees, teller fees, check processing fees, etc. They have largely rid themselves of all that and place the burden instead on those who overdraft. At one point there were two competing banks, one that placed the charges more uniformly amongst everyone who uses their services and the other who placed the cost more on the irresponsible. Everyone took their money and put it in the second bank. That bank is not evil, it is just serving the people how they want to be served.

 

[piasabird]

It is illegal to write a check for money you dont have. This is a cold hard fact. Would people prefer to go to jail for each overdraft?

Overdraft = stealing.

This does not mean that I think that banks are intellectually honest.

If a bank has an ATM, there is a general rule that the ATM has separate rules from the bank. If you think a bank has gotten the best of you, close your account and move it some place else. If they give you some baloney when you deposit your check and they say they did not have your money, then take your money out and go to a more friendly bank. There is a difference between a pay check and a normal third party check. I had this kind of problem with a credit union and I severed ties with them for good after 15 years of keeping my money with them. That is what any financial institution deserves for violating your trust.

 

[1LordEmperor1]

Originally posted by: cubby1223Remember how banks *used* to operate? General monthly fees, ATM fees, teller fees, check processing fees, etc.

I still pay all those.

 

[cubby1223]

Heck, many banks now tie together checking accounts with a credit card, so that if you ever overdrew your checking account the difference is taken from your credit card account instead of rung up in overdraft fees.

Seriously, people in this country need to f'ing learn some damn personal responsibility :roll:

 

[her209]

Originally posted by: cubby1223
What is wrong with you people? They charge overdraft fees. Solution is to not overdraft your account.

It's just so tiring to continue to read that the fees are all pure "profit" and therefore evil. Go out and live in the real world someday. Those fees pay the salaries of the employees, keeps them in a job, something that we're running out of in this country. Those fees pay for the taxes the business has to pay to the government, something the government is also running out of these days. Those fees pay for their expenses, like the electricity so you have a place to go to when you need to use their services.

Remember how banks *used* to operate? General monthly fees, ATM fees, teller fees, check processing fees, etc. They have largely rid themselves of all that and place the burden instead on those who overdraft. At one point there were two competing banks, one that placed the charges more uniformly amongst everyone who uses their services and the other who placed the cost more on the irresponsible. Everyone took their money and put it in the second bank. That bank is not evil, it is just serving the people how they want to be served.

I'd agree with you if the banks credited and debited in the order of the transactions they receive. But they don't. They are intentionally causing overdrafts and a disproportionate of overdrafts are incurred by those who are paycheck-to-paycheck or financially irresponsible. For the former, someone who makes just enough to cover their bills, if they overdraft once, this means they get charged $35 on top of their bills, thus causing them to likely overdraft the following month, and so on.

 

[WHAMPOM]

Breaking news. Banks no longer to collect fees on a less then $10.00 overdraft. $50.00 would be more realistic.

 

[Atreus21]

What we ought to do is stop bitching and implement our own solution.

Start a bank. No overdraft fees, no honoring purchases for more money than you have, and we apply purchases in order.

We'd make a fortune. The entire market landscape would conform to us.

Anybody got the cadgownees?

 

[GTKeeper]

Originally posted by: yllus
One overdraft in my life - a rather harsh $20 fee. Asked politely over the phone and had it reversed.

I think the fees are ridiculous, but it's up to the consumer to not end up in that position to begin with. But on the other hand, when you're reduced to living hand-to-mouth you end up in an endless cycle of just barely paying the bills that this sort of punitive fee can only aggravate. Can't bring myself to support any legislation on the matter, though.

How do you feel about banks re-arranging transactions so that the largest debit hits your account first?

 

[Pulsar]

Originally posted by: Atreus21
What we ought to do is stop bitching and implement our own solution.

Start a bank. No overdraft fees, no honoring purchases for more money than you have, and we apply purchases in order.

We'd make a fortune. The entire market landscape would conform to us.

Anybody got the cadgownees?

They're called decent credit unions. And they do very well.

 

[Ronstang]

Originally posted by: Killerme33
If banks stopped charging overdraft fees they would have to make up the $ somewhere - most likely on checking/savings fees. Be grateful that 10% of the customers are subsidizing the other 90%. Also don't let your balance get so low. If you are someone who is constantly overdrafting or in danger of it, a bank is not gonna shed too many tears if you take your business elsewhere.

I am. I haven't had a balance in a bank account below $3000 in the last 25 years. Overdraft fees are something I have never ever even put any thought into.

 

[yllus]

Originally posted by: GTKeeper

Originally posted by: yllus
One overdraft in my life - a rather harsh $20 fee. Asked politely over the phone and had it reversed.

I think the fees are ridiculous, but it's up to the consumer to not end up in that position to begin with. But on the other hand, when you're reduced to living hand-to-mouth you end up in an endless cycle of just barely paying the bills that this sort of punitive fee can only aggravate. Can't bring myself to support any legislation on the matter, though.

How do you feel about banks re-arranging transactions so that the largest debit hits your account first?

Still the same position - it's a ridiculous policy (and one I know of, as I've worked at a major Canadian bank) and can really mess with the person living close to the edge, but it's not worthy of legislation. There are enough options available to not require that.

 

[ebaycj]

Originally posted by: cubby1223
What is wrong with you people? They charge overdraft fees. Solution is to not overdraft your account.

...

Remember how banks *used* to operate? General monthly fees, ATM fees, teller fees, check processing fees, etc. They have largely rid themselves of all that and place the burden instead on those who overdraft.

Yes, I do:

Originally posted by: ebaycj

Originally posted by: Athena

Originally posted by: ebaycj

Originally posted by: tk149

Originally posted by: ebaycj

No, but I also do not feel I should pay 5000%+ in interest on it.

"Fees" that are automatically charged need to be included in existing usury laws. They need to be percentage based and therefore adjustable to the amount of the transaction that the fee is paid on.

Including: ATM fees, Overdraft fees, Chargeback fees, Wire Transfer fees, "Teller" fees, Online Banking fees, Telephone Banking fees, Electronic Check fees, Direct Debit fees, etc...

Not including: Mortgage / Loan application fees.

I think the fees are too high, but I don't believe this needs government regulation. Some people in this thread are very happy with their credit unions. If you don't like your banks' fees, go somewhere else. Banks charge what the market will support. If they charge more, they lose customers. That simple.

Also, most of the fees you listed involve direct costs to a bank. For example, ATM fees. IIRC, banks charge each other money for ATM transactions. Why not pass the cost on to the customer? Even the Telephone Banking fees involve some cost (albeit very low per transaction). You wouldn't expect McDonalds to not charge for cooking a burger, would you?

You know what offsets all of those costs? The fact that they can take MY MONEY and lend it out to others AND MAKE INTEREST ON IT as long as I have it deposited in their bank.

...Which used to be the entire reason that banks existed. In those days they made money by providing the service of making money available to those who needed it. Now, they make more on fees than they do on renting money.

Not to mention the fact that running a bunch of ATM's is WAY WAY cheaper than having that many local branches, and hiring that many tellers.

 

[ebaycj]

Originally posted by: piasabird
It is illegal to write a check for money you dont have. This is a cold hard fact. Would people prefer to go to jail for each overdraft?

Overdraft = stealing.

This does not mean that I think that banks are intellectually honest.

If a bank has an ATM, there is a general rule that the ATM has separate rules from the bank. If you think a bank has gotten the best of you, close your account and move it some place else. If they give you some baloney when you deposit your check and they say they did not have your money, then take your money out and go to a more friendly bank. There is a difference between a pay check and a normal third party check. I had this kind of problem with a credit union and I severed ties with them for good after 15 years of keeping my money with them. That is what any financial institution deserves for violating your trust.

Overdraft != Stealing
and
Check != Debit

The reason check kiting (writing a check for money you don't have) is illegal, is because there is no immediate certification of whether or not you actually have the funds in your checking account. For example, you can make a "purchase" with the (worthless) check, and leave with the "goods" immediately. The illegality of the check doesn't become apparent to the other party for a few days, by which time you (and/or the "goods") could be long gone, making it difficult to find you.

With Debit, there is an immediate certification as to whether you have the funds. The merchant knows before the "sale" is made that you have the funds and that said funds will be transferred to the merchant's account. He therefore can deny you the opportunity to leave with the goods, assuming you don't have the funds to pay for said goods.

 

[dmcowen674]

Originally posted by: cubby1223
What is wrong with you people? They charge overdraft fees. Solution is to not overdraft your account.

What the fuck is wrong with you that you can't read and comprehend?

The banks are making the overdrafts up with nefarious computer programming.

That's the fucking problem enough so that congress had to step in and slap the bitches.

Although a slight slap on the wrist it is a slap nonetheless.

If the problem didn't exist this thread wouldn't exist.

The fact you condone the banks stealing suggests you personally benefit in some way.

Hopefully you will be losing some of the ill gotten gains.

 

[dmcowen674]

Originally posted by: GTKeeper

Originally posted by: yllus
One overdraft in my life - a rather harsh $20 fee. Asked politely over the phone and had it reversed.

I think the fees are ridiculous, but it's up to the consumer to not end up in that position to begin with. But on the other hand, when you're reduced to living hand-to-mouth you end up in an endless cycle of just barely paying the bills that this sort of punitive fee can only aggravate. Can't bring myself to support any legislation on the matter, though.

How do you feel about banks re-arranging transactions so that the largest debit hits your account first?

Obviously him and Cuddy love it.

9-24-09 Why banks sit on deposits

What is it with these banks that are so quick to hit you with a fee for spending more than you have in your checking account but take their own sweet time in crediting deposits?

The angry questions happened to arrive as we approach the five-year anniversary of when the federal law known as Check 21 took effect.

Banks must make your deposits of local checks available no later than two business days after you hand them over. But they get a full five days on nonlocal accounts. In either case, they must make $100 available to you the next business day after the deposit as a sort of good-faith advance. That number, too, has not changed in two decades.

The bad news, however, is that there are still a number of exceptions that allow banks to put a hold on part or all of the deposit, often for at least five business days. Any deposit over $5,000 is automatically suspect. If your account has been overdrawn at least six days in the last six months, then the bank can delay all deposits to your account. If your account is less than 30 days old, then your bank gets the extra time there, too (plenty of fraud happens in new accounts).

 

[StageLeft]

I went to my bank yesterday. They told me they always do credits before debits, so that's nice. Also, if I overdraft in a given day as long as I refill the account before that night, I don't get fees. However, they cannot turn off overdrafting on my account. I can get protection, which I didn't want to pay for. The best thing they could do was make it such that if the day starts off negative absolutely everything will then be rejected, but it's impossible to make it so that the account real-time becomes disabled if it hits an overdraft point.

 

[Phokus]

It gets better: Banks will intentionally "sort" transactions from a given day to produce the maximum overdraft fee. They sort withdrawals to debit them largest-amount-first, because the fee is assessed per item. An example:

$1,000 in your account.

You write checks for $20, $50, $100, $1,000 and all are presented on the same business day.

How many checks will hit you with an overdraft fee?

THREE - every time. The bank will re-order the transactions so that the $1,000 check is processed first, guaranteeing that the $20, $50 and $100 checks overdraw, thereby generating three overdraft charges. If they processed the transactions "largest item LAST" you'd generate one overdraft fee - on the $1,000 check.

HAHAHAHAHA, how the hell is this even legal.

 

[Ausm]

Banks having been fucking people over this way for years.

 

[blackangst1]

Originally posted by: GTKeeper

Originally posted by: yllus
One overdraft in my life - a rather harsh $20 fee. Asked politely over the phone and had it reversed.

I think the fees are ridiculous, but it's up to the consumer to not end up in that position to begin with. But on the other hand, when you're reduced to living hand-to-mouth you end up in an endless cycle of just barely paying the bills that this sort of punitive fee can only aggravate. Can't bring myself to support any legislation on the matter, though.

How do you feel about banks re-arranging transactions so that the largest debit hits your account first?

I personally have mixed feelings. I guess Im not part of the conspiracy theory crowd that believes they do it intentionally to rack up fees. But, it IS true that typically the important bills will be higher dollar amounts, and thus clear them first (i.e. rent/mortage, car, etc). I see both sides of the argument (tin foil hat crowd aside) and to me it makes sense.

 

[Phokus]

Originally posted by: blackangst1

Originally posted by: GTKeeper

Originally posted by: yllus
One overdraft in my life - a rather harsh $20 fee. Asked politely over the phone and had it reversed.

I think the fees are ridiculous, but it's up to the consumer to not end up in that position to begin with. But on the other hand, when you're reduced to living hand-to-mouth you end up in an endless cycle of just barely paying the bills that this sort of punitive fee can only aggravate. Can't bring myself to support any legislation on the matter, though.

How do you feel about banks re-arranging transactions so that the largest debit hits your account first?

I personally have mixed feelings. I guess Im not part of the conspiracy theory crowd that believes they do it intentionally to rack up fees. But, it IS true that typically the important bills will be higher dollar amounts, and thus clear them first (i.e. rent/mortage, car, etc). I see both sides of the argument (tin foil hat crowd aside) and to me it makes sense.

lol you free market cultists are so adorable.

 

[blackangst1]

Originally posted by: dmcowen674

Originally posted by: cubby1223
What is wrong with you people? They charge overdraft fees. Solution is to not overdraft your account.

What the fuck is wrong with you that you can't read and comprehend?

The banks are making the overdrafts up with nefarious computer programming.

That's the fucking problem enough so that congress had to step in and slap the bitches.

Although a slight slap on the wrist it is a slap nonetheless.

If the problem didn't exist this thread wouldn't exist.

The fact you condone the banks stealing suggests you personally benefit in some way.

Hopefully you will be losing some of the ill gotten gains.

The problem is NOT bank's overdraft practices or fees. The problem IS people spending more than they have. The occasional OD isnt going to ruin someone. Hell, most banks will work with you. It hurts those who consistantly rack up OD fees (hell, they wouldnt get shit if they used cash....at least with a bad check they receive a good or service they havent paid for!).

 

[blackangst1]

Originally posted by: Phokus

Originally posted by: blackangst1

Originally posted by: GTKeeper

Originally posted by: yllus
One overdraft in my life - a rather harsh $20 fee. Asked politely over the phone and had it reversed.

I think the fees are ridiculous, but it's up to the consumer to not end up in that position to begin with. But on the other hand, when you're reduced to living hand-to-mouth you end up in an endless cycle of just barely paying the bills that this sort of punitive fee can only aggravate. Can't bring myself to support any legislation on the matter, though.

How do you feel about banks re-arranging transactions so that the largest debit hits your account first?

I personally have mixed feelings. I guess Im not part of the conspiracy theory crowd that believes they do it intentionally to rack up fees. But, it IS true that typically the important bills will be higher dollar amounts, and thus clear them first (i.e. rent/mortage, car, etc). I see both sides of the argument (tin foil hat crowd aside) and to me it makes sense.

lol you free market cultists are so adorable.

Personally I would rather my bank clear my rent or car payment than anything else. Maybe youre different.

 

[thegimp03]

Something doesn't make sense here. Love how we the taxpayers bailed a lot of these banks out and they raise fees. Your welcome.

 

[gingermeggs]

Originally posted by: rudder
Credit Unions FTW!!! Especially the small personal ones where if you accidently overdraft your account... they are kind enough to remove the fees as long as you put money in the account.

:thumbsup:

 

[gingermeggs]

Originally posted by: tk149

Even rich people overdraft sometimes (their money is in another account - not their checking account).

Like when its in a tax haven