|
|
|
|
|
Users viewing this topic:
none
|
|
Login  | |
|
Hard lesson learned on overdraft fees - 8/27/2009 10:03:43 AM
|
|
|
stateofgrace
Posts: 1585
Joined: 4/12/2005
Status: online
|
Banks Feast on Billions of Overdraft Fees
Here's the deal. In the case of the bank used in the example in this news story, the bank extends the "courtesy" of 10 overdrafts a day going through on a debit card.
Recently while my husband was on the road he made some small purchases that ended up throwing a checking account into overdraft. I had email alerts set up to let me know about these sorts of issues - and promptly went to the bank and deposited a check from another local bank. The bank with the checkinig account, who advertises funds being available the same business day, placed a hold of several days on the deposited check. Also, I had attempted to make a deposit large enough to cover the overdrafts and provide a cushion. But because the deposit was held, the account continued to hit overdrafts (remember, they will extend the "courtesy" of allowing you to overdraft 10 X a day!).
So, here are some hard lessons learned (and if you google, you can find many, many consumer complaints about this).
1) Tellers don't always let you know how long a deposit check is going to be held. And sometimes deposits are held for longer than you've been informed.
2) Email alerts won't necessarily give you useful information to deal with potential overdrafts or low balances - often they come in so late that the situation is worse then you know, even if you go to the bank to address the problem within an hour or so of receiving the alert.
3) Even online balances (and this is one that hit me) may not reflect all the current charges from the bank (not to mention transactions that haven't processed yet).
4) Banks have ways of processing that maximize their potential overdraft charges...not only holding the deposits, but also processing the largest transactions first.
5) It's very difficult to keep track of a joint account when one spouse is traveling for work and debiting from that account, but this is a really easy way to send an account into overdraft.
6) Beware of transactions that have not been processed in a timely manner - they can come back to bite you - there was a transaction that was supposed to go through at one point, and I thought it had. Then about a week later, the transaction was actually posted.
7) The only apparent way to ensure that a deposit is going to be credited quickly is to deposit cash.
...and finally....
8) Just because a transaction goes through doesn't mean the funds are available in your account to cover it.
See also: USA Today: Bank's "Courtesy Loans" at Soaring Rates Irk Customers
_____________________________
America Needs Revival. Will you commit to pray for it?
|
|
|
|
|
RE: Hard lesson learned on overdraft fees - 8/27/2009 10:33:48 AM
|
|
|
Mrs.Wifey
Posts: 3406
Joined: 4/12/2005
From: The Gorgeous plains of Colorado
Status: offline
|
Yup. Always deposit cash when trying to cover or prevent overdraft charges.
_____________________________
Ryanne- trying hard to be my husband's girlfriend and my daughter's mother.
I'll keep my guns, freedom, and money- you can keep "the change."
|
|
|
|
|
RE: Hard lesson learned on overdraft fees - 8/27/2009 11:46:16 AM
|
|
|
stateofgrace
Posts: 1585
Joined: 4/12/2005
Status: online
|
I am going to have to try and find some way to cover my husband while he is working, without him using the main checking account debit card.
_____________________________
America Needs Revival. Will you commit to pray for it?
|
|
|
|
|
RE: Hard lesson learned on overdraft fees - 8/27/2009 12:16:02 PM
|
|
|
Miss Giggles
Posts: 5207
Joined: 4/18/2005
From: MI
Status: offline
|
Try mvelopes.com. It's an online budgeting system.. you two can share the password. The best thing is that you can enter in manual transactions for the debit card, so for stuff like gas that doesn't clear right away then you won't be surprised.
|
|
|
|
|
RE: Hard lesson learned on overdraft fees - 8/27/2009 1:51:08 PM
|
|
|
GraceyGirl
Posts: 347
Joined: 6/4/2006
Status: offline
|
The way we dealt with this problem was really simple. We have a "household" account with Navy Federal. The majority of our check is deposited into this account. However, $250 a week is put into two other accounts, that are separate from one another. PayPal has an awesome Business Premier account that we both use, and is linked to our NFCU account in the event that we need more funds than is available. We both have corporate cards through our companies, but sometimes you have to pay for things on your own, and then be reimbursed. If he wants lunch out, or wants to buy me a gift, something like that, then he uses his PayPal debit MasterCard. Same with me. If one of us is travelling and can't use the corporate card, we use the PayPal card. Lots of times I'll use it for gas since I get cash back. We average about $14 in fees per month between the two of us for PayPal, which is a LOT better than a bunch of $30 OD fees.
_____________________________
God called. He'd like His church back.
~John Wimber~
|
|
|
|
|
RE: Hard lesson learned on overdraft fees - 8/27/2009 2:05:49 PM
|
|
|
Miss Giggles
Posts: 5207
Joined: 4/18/2005
From: MI
Status: offline
|
That's ridiculous. I mean its cash!
I try to pay zero fees for checking and savings. One time they did hold my payroll checks and I bounced some things for the one day it took to clear.
They keep building a bank and credit union here on every corner so I can keep switching until I am satisfied. LOL
|
|
|
|
|
RE: Hard lesson learned on overdraft fees - 8/27/2009 2:20:19 PM
|
|
|
Mrs.Wifey
Posts: 3406
Joined: 4/12/2005
From: The Gorgeous plains of Colorado
Status: offline
|
quote:
ORIGINAL: GraceyGirl
The way we dealt with this problem was really simple. We have a "household" account with Navy Federal. The majority of our check is deposited into this account. However, $250 a week is put into two other accounts, that are separate from one another. PayPal has an awesome Business Premier account that we both use, and is linked to our NFCU account in the event that we need more funds than is available. We both have corporate cards through our companies, but sometimes you have to pay for things on your own, and then be reimbursed. If he wants lunch out, or wants to buy me a gift, something like that, then he uses his PayPal debit MasterCard. Same with me. If one of us is travelling and can't use the corporate card, we use the PayPal card. Lots of times I'll use it for gas since I get cash back. We average about $14 in fees per month between the two of us for PayPal, which is a LOT better than a bunch of $30 OD fees.
That's a good idea!
I think I would spend my paypal money on fabric, though  
_____________________________
Ryanne- trying hard to be my husband's girlfriend and my daughter's mother.
I'll keep my guns, freedom, and money- you can keep "the change."
|
|
|
|
|
RE: Hard lesson learned on overdraft fees - 8/28/2009 12:51:35 AM
|
|
|
iluvatar
Posts: 3045
Joined: 4/12/2005
Status: offline
|
That's why I don't use debit cards. I put purchases on a credit card and then pay it at the end of the month. All the bills get paid when we know there's money in there. No sneaky transactions blindsiding us.
-Dan.
_____________________________
Well, I've been to one world fair, a picnic, and a rodeo, and that's the stupidest thing I ever heard come over a set of earphones.
|
|
|
|
|
RE: Hard lesson learned on overdraft fees - 8/28/2009 4:30:36 AM
|
|
|
manda59
Posts: 8208
Joined: 9/22/2005
From: Hampshire, UK
Status: offline
|
quote:
ORIGINAL: Mrs.Wifey
Yup. Always deposit cash when trying to cover or prevent overdraft charges.
I don't agree with internet banking, but we have phone banking set up, so I do it by phone transfer; that way it's instant. Or I go into a branch and get the clerk to transfer it. That's between accounts at the same bank.
_____________________________
"Manda.....you said what I tried to say, just much better"
sharonjef, October 2009
|
|
|
|
|
RE: Hard lesson learned on overdraft fees - 8/28/2009 8:39:01 AM
|
|
|
peace77
Posts: 275
Joined: 4/18/2005
Status: offline
|
Prevention is the best policy. Our checking account is tied to a savings account and a line of credit at the same credit union so it is impossible for one of us to cause an overdraft.
The normal way that banks handle transactions is to process the larger checks or withdrawals first, then the smaller withdrawals and then the deposits.
That way there is a greater chance of the bank receiving overdraft fees and more of them.
Banks hold checks over a certain amount. It's always a good idea to know what that amount is for your bank since each one is different.
If you need cash quickly, go to the bank that the check is written on and cash it there (if you can). This will also prevent the check from bouncing after you try to deposit it in your account. The teller will tell you if there aren't sufficient funds to cash the check.
Peace,
Anne
_____________________________
I GoodSearch for Deaf Missions.
Raise money for your favorite charity or school just by searching the Internet or shopping online with GoodSearch - www.goodsearch.com
|
|
|
|
|
RE: Hard lesson learned on overdraft fees - 8/28/2009 1:44:58 PM
|
|
|
stateofgrace
Posts: 1585
Joined: 4/12/2005
Status: online
|
quote:
ORIGINAL: peace77
Banks hold checks over a certain amount. It's always a good idea to know what that amount is for your bank since each one is different.
Yes, but some banks will selectively hold deposits (especially if if the customer has a low account balance or overdraft), and will selectively hold those deposits for a long period.
I would potentially expect a hold of a few days on a personal check. What I don't expect is to have the bank pull a long hold out of the blue.
There are some real horror stories on consumer complaint sites regarding the length of time deposits have been held.
At least in my case the teller told me how long it was supposed to be.
It appears that the bank did have use of my money for 2 to 3 days before crediting me because I watched the online account that the check was written on, and saw when the check posted there.
I'm going to look into the ramifications of doing most of our banking through the credit union. When I explained all the situation to hubby, he wanted me to get out of doing business with that bank ASAP. I explained that with electronic paycheck deposits and several auto-drafts each month, it's not that simple to move.
< Message edited by stateofgrace -- 8/28/2009 4:30:11 PM >
_____________________________
America Needs Revival. Will you commit to pray for it?
|
|
|
|
|
RE: Hard lesson learned on overdraft fees - 8/28/2009 1:56:39 PM
|
|
|
GregandJenny
Posts: 665
Joined: 2/16/2006
From: Near Seattle Washington
Status: offline
|
quote:
It appears that the bank did have use of my money for 2 to 3 days before crediting me because I watched the online account that the check was written on, and saw when the check posted there.
That doesn't mean the bank has use of your money, it means the account had the money taken out. It could very well be a speedy process from one bank to request money from one bank and then a slower process from that bank to get back. This happened to me with my CU before.
G
_____________________________
It does not have to be well with my circumstance to be well with my soul!
|
|
|
|
|
RE: Hard lesson learned on overdraft fees - 8/29/2009 6:38:34 PM
|
|
|
zoebob
Posts: 7961
Joined: 4/13/2005
From: land of limbo
Status: online
|
My bank use to put a 3 day hold on local checks, 5 day on further distance checks, and no hold on paychecks and government checks. Then they recently started putting a 5 day hold on those local checks too. However, if a check comes in against a held check it will clear. However, debit card purchases do not.
_____________________________
L-R: DD1, Ellies DS2, DD2, Ellies DS1
L-R: Ellies DD1, Ellies DD2, DS, Ellies DS3
|
|
|
|
|
RE: Hard lesson learned on overdraft fees - 8/30/2009 5:34:03 PM
|
|
|
agapetos
Posts: 9751
Joined: 4/11/2005
From: This side of the lil duck pond!
Status: online
|
It takes my bank 5 working days to clear a cheque, it's instant for cash. Only time this year when I've had a problem is when I should have had some money go in but it didn't. I contacted the place that should have paid me and they made an emergency payment. I also contacted my bank who looked at my outgoings. There was one payment which was declined (insufficient funds!) and they waived the charges as it wasn't my fault.
I keep some money in a savings account if I run out of money before I next get any money. If I take from it, I repay when I do get paid so I have a buffer each month ~ and what I don't use (and I don't often) earns me interest. I check my balance most days.
_____________________________
Stovie, Stovie, what am I going to do with you!
Maggie
September 09
My blog
|
|
|
|
|
RE: Hard lesson learned on overdraft fees - 8/30/2009 9:01:37 PM
|
|
|
humbleinspirit
Posts: 16732
Joined: 4/13/2005
From: Just Outside of Boston
Status: offline
|
It takes 3 days for a local check to clear here.
This is the latest dirty trick that banks are using, they can't get money from credit card fees, so they are tacking them up on overdrafts instead. 
_____________________________
|
|
|
|
|
RE: Hard lesson learned on overdraft fees - 8/30/2009 9:06:07 PM
|
|
|
GregandJenny
Posts: 665
Joined: 2/16/2006
From: Near Seattle Washington
Status: offline
|
quote:
This is the latest dirty trick that banks are using, they can't get money from credit card fees, so they are tacking them up on overdrafts instead.
I don't think this is a hard fast rule, I think it really depends on your banking institution
_____________________________
It does not have to be well with my circumstance to be well with my soul!
|
|
|
|
|
RE: Hard lesson learned on overdraft fees - 8/30/2009 9:06:42 PM
|
|
|
humbleinspirit
Posts: 16732
Joined: 4/13/2005
From: Just Outside of Boston
Status: offline
|
quote:
ORIGINAL: GregandJenny
quote:
This is the latest dirty trick that banks are using, they can't get money from credit card fees, so they are tacking them up on overdrafts instead.
I don't think this is a hard fast rule, I think it really depends on your banking institution
Yes, I do not mean all of them, I just mean generally speaking instead.
_____________________________
|
|
|
|
|
RE: Hard lesson learned on overdraft fees - 9/1/2009 4:16:08 AM
|
|
|
Momto3boys1girl
Posts: 12
Joined: 4/18/2005
From: Land of 10,000 Lakes
Status: offline
|
We were informed that if we deposit through the ATM it will be in the account that day(up till 6pm)-even checks. If we deposit through a teller, even cash is not available immediately.
_____________________________
Kristi
|
|
|
|
|
RE: Hard lesson learned on overdraft fees - 9/1/2009 9:55:42 AM
|
|
|
blessedinnyc
Posts: 2903
Joined: 10/12/2007
From: NYC by way of Chicago
Status: offline
|
quote:
ORIGINAL: humbleinspirit
It takes 3 days for a local check to clear here.
This is the latest dirty trick that banks are using, they can't get money from credit card fees, so they are tacking them up on overdrafts instead.
I think there's some good news coming, though- there's regulation that would prevent banks from allowing overdrafts unless you separately request it.
You can always call up the bank and ask them to turn off overdraft protection. They will try to convince you not to, but I do believe that they are legally required to turn it off if you ask them.
Don't listen to their horror stories about bounced checks- anyone who's been overdrafted will tell you that it's better to bounce a paper check and pay ONE bounced check fee than it is to get charged $35 multiple times in a single day because you were unaware of your bank balance.
|
|
|
|
|
RE: Hard lesson learned on overdraft fees - 9/1/2009 10:54:11 AM
|
|
|
GregandJenny
Posts: 665
Joined: 2/16/2006
From: Near Seattle Washington
Status: offline
|
quote:
Don't listen to their horror stories about bounced checks- anyone who's been overdrafted will tell you that it's better to bounce a paper check and pay ONE bounced check fee than it is to get charged $35 multiple times in a single day because you were unaware of your bank balance.
People need to be aware though that 2 things can happen. First when you Bounce a check it is subject to 2 fees, one from your bank and one for the institution you wrote the bad check and you have to make sure that the check is not presented for payment twice. So that could add up. I could definately be more that 100 bucks for one check.
G
_____________________________
It does not have to be well with my circumstance to be well with my soul!
|
|
|
|
|
RE: Hard lesson learned on overdraft fees - 9/1/2009 11:01:00 AM
|
|
|
stateofgrace
Posts: 1585
Joined: 4/12/2005
Status: online
|
quote:
ORIGINAL: Momto3boys1girl
We were informed that if we deposit through the ATM it will be in the account that day(up till 6pm)-even checks. If we deposit through a teller, even cash is not available immediately.
Don't take that ATM thing as being applicable all the time - the bank I use makes that claim and if your account balance is low or overdrawn, they can still hold checks.
_____________________________
America Needs Revival. Will you commit to pray for it?
|
|
|
|
|
RE: Hard lesson learned on overdraft fees - 9/1/2009 3:48:57 PM
|
|
|
blessedinnyc
Posts: 2903
Joined: 10/12/2007
From: NYC by way of Chicago
Status: offline
|
quote:
ORIGINAL: GregandJenny
People need to be aware though that 2 things can happen. First when you Bounce a check it is subject to 2 fees, one from your bank and one for the institution you wrote the bad check and you have to make sure that the check is not presented for payment twice. So that could add up. I could definately be more that 100 bucks for one check.
That's true- you have to pay fees on both sides, but the bank won't be allowed to overdraft you for ATM withdrawals, account fees, or or debit purchases. I can live with $70 in bounced-check costs; I can't live with $245 in overdraft fees after I withdraw money at an ATM in the morning, buy a bagel at starbucks, pay for a metro card at the train station, get an orange juice at the cafeteria at work, buy lunch, take a cab, and buy groceries all before I get home and check my account balance.
The extra $35 cost of paying the returned check fee if you bounce one of the two or three paper checks you write a month is a small price to pay to avoid overdrafting the ~100-200 debit purchases many people make per month.
|
|
|
|
|
RE: Hard lesson learned on overdraft fees - 9/5/2009 11:16:39 AM
|
|
|
Covaan_Meshuga
Posts: 3173
Joined: 6/8/2005
From: being knit together in my mother's womb
Status: offline
|
My son is a banker, and he says that the banks thrive on overdraft fees -- meaning that this is how they make their money. If it were not for those who consistently overdraft, the banks would be hurting more than some of them are already.
He says that those who consistently overdraft are real interesting, always expect a break even though they overdraft all the time, and get very angry when the bank won't give them a break -- then they go on doing it again and again. He can't tell me much, because of privacy, but he has told me a little.
There was one woman he really felt sorry for, because she was new to his bank, so he talked to her about different things she could do to protect herself. She declined everything and just kept on bouncing.
_____________________________
While in prayer or praise, I am only as devoted to G-d as I am in my most private moments.
Abiyah, if you had known them as G-d knows them, you would have answered them differently.
|
|
|
|
 New Messages |
 No New Messages |
 Hot Topic w/ New Messages |
 Hot Topic w/o New Messages |
 Locked w/ New Messages |
 Locked w/o New Messages |
|
 Post New Thread
Reply to Message
Post New Poll
Submit Vote
Delete My Own Post
Delete My Own Thread
Rate Posts |
|
|
|
|
|
|
|
|
|
|
|
Forum Tools
Printable Version
MARRIED TO A MILITARY PILOT ~ PLEASE PRAY FOR OUR TROOPS! 
