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The $36 soda: Overdrafting in America

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Re: The $36 soda: Overdrafting in America

#171

Post by ralph »

eftpotrm wrote: post #134
cperciva wrote: post #101

Earlier quoted context omitted.

Also, the cash advance interest differential for credit-cards, which is higher, and only paid off after all other charges are covered, rather than any sort of temporal ordering FWIW, in Canada credit card issuers are required to apply payments to whichever balances you're paying the highest interest rate on -- it's not even temporally ordered.

Are you complaining that they're required to service the more expensive (to you) debts first? Why? UK banks used to have a god racket (don't know if they still do, don't read the relevant blogs) where they'd offer 0% balance transfer cards but with expensive purchase interest. Then, any payments you made went to paying off the oldest debt first (on which you were paying 0% interest) leaving the purchases quickly gain…

I think the UK is now like Canada; payments to the card issuer must now be offset against the dearest loan first.

Re: The $36 soda: Overdrafting in America

#172

Post by pbhjpbhj »

pbhjpbhj wrote: post #136
andrewljohnson wrote: post #23

I agree that banks are predatory, but the fact that people can't keep ~$500 in their bank account indicates they are spending more than they are earning. When someone can't keep an extremely small amount of cash on hand at all times. it doesn't mean they are living paycheck to paycheck and just netting zero - it means they are accruing debt every cycle, and then struggling to stay cash flow positive in any way necess…

> When someone can't keep an extremely small amount of cash on hand at all times. // Your "extremely small amount of cash" is my families disposable income for the entire month. That is, all we have to live on after tax and direct housing costs. A simple accident/incident (last year a small section of our roof caved in, the insurance company says it wasn't covered as there wasn't a 'storm') can wipe that amount out e…

sp: family's

Re: The $36 soda: Overdrafting in America

#173

Post by wnight »

ceejayoz wrote: post #16
esrauch wrote: post #5

Earlier quoted context omitted.

Banks do this but they will easily reverse all but one of them if you call without even arguing. If you argue a bit, I think they would reverse even the legitimate one.

Not KeyBank. I had a situation like this in college. Several levels of escalation finally got two of six overdraft charges lifted, but I was told that two reversed charges was the limit per year, no matter what the reason.

They were lying.

There are no limits like that because that wouldn't make sense.

I really wish we threw managers like that in jail though. They know they're enough of a roadblock that their denial to help will squash most legitimate complaint, letting them keep most of their stolen money. A 5-8 years sentence for fraud for them and coworkers who aided and abetted this would do wonders to stopping this kind of thing.

Re: The $36 soda: Overdrafting in America

#174

Post by Someone »

mcherm wrote: post #149

I work for a US bank, "ING Direct". On our "checking" account (electronic payments preferred), our policy for overdrafts works like this: if you overdraw your account, we do NOT charge you an overdraft fee. Instead, we automatically turn it into a loan at typical unsecured lending rates (11.25% today: prime plus 8%). As soon as you deposit enough money to go back to a positive balance, we go back to paying interest o…

?US? Bank? Not surprisingly, given this discussion, ING Direct USA is a daughter of a Dutch bank http://www.ing.com/Our-Company.htm

Re: The $36 soda: Overdrafting in America

#175

Post by Someone »

mcherm wrote: post #149

I work for a US bank, "ING Direct". On our "checking" account (electronic payments preferred), our policy for overdrafts works like this: if you overdraw your account, we do NOT charge you an overdraft fee. Instead, we automatically turn it into a loan at typical unsecured lending rates (11.25% today: prime plus 8%). As soon as you deposit enough money to go back to a positive balance, we go back to paying interest o…

?US? Bank? Not surprisingly, given this discussion, ING Direct USA is a daughter of a Dutch bank http://www.ing.com/Our-Company.htm

Re: The $36 soda: Overdrafting in America

#176

Post by Natsu »

_delirium wrote: post #131
Natsu wrote: post #100

Earlier quoted context omitted.

The main advantage is that credit unions are member-owned and therefore run to benefit the members, not some investors. This keeps them from having an interest in screwing you via weird fees and whatnot. The main disadvantage I've seen is that smaller ones have less leverage and so you pay more ATM fees to other banks. I've been in the no credit card boat, so I know exactly what you mean. I got mine by having a car l…

> The main disadvantage I've seen is that smaller ones have less leverage and so you pay more ATM fees to other banks. Many credit unions are now part of ATM networks where you can use any of the members' ATMs fee-free, and in some cases can use other members' branch offices for free as well (at least for routine stuff). Depends somewhat on your location and your ATM-using habits; if you need to use a random mall ATM…

I notice this because the only free ATMs I know of are too far out of my way to be practical. I would probably do better to move to a larger credit union, but I don't know of any others I could join.

Re: The $36 soda: Overdrafting in America

#177

Post by nknight »

enjo wrote: post #90
nknight wrote: post #76

Earlier quoted context omitted.

I haven't set foot in a bank branch in over a year, and then only to deal with a problem caused by the confluence of their antiquated model and that of another company. I've never once made a phone call to, or received one from, my current bank in the ~7 years my current checking account has been open. I don't know who you think they're maintaining such anachronisms for, but it ain't this free checking user. The comp…

Next time you walk by a bank branch, take note of how many people are inside. That would likely indicate that your something of a anomaly.

Um, zero?

That was pretty much the case whenever I went in to a bank branch in past years. Often I was the only one there, never was the employee to customer ratio less than 5:1, and anyone who was there was most likely to be 60+.

A visit to a physical bank branch is the anomaly today, not a lack thereof.

Re: The $36 soda: Overdrafting in America

#178

Post by notJim »

nknight wrote: post #76
notJim wrote: post #65

Earlier quoted context omitted.

I think you're missing out on a lot of things. The bank definitely has costs that go into supporting its customers: branches and employees to staff them (most banks, not all of course), phone support people, the very computer systems you talk about, and people to keep them running and add new features to them. Most mainstream banks' free checking accounts make these things available to account holders, so I don't kno…

I haven't set foot in a bank branch in over a year, and then only to deal with a problem caused by the confluence of their antiquated model and that of another company. I've never once made a phone call to, or received one from, my current bank in the ~7 years my current checking account has been open. I don't know who you think they're maintaining such anachronisms for, but it ain't this free checking user. The comp…

The thing that matters is that those are available to you. The bank does some modeling on how much use all of those facilities will get, and plans accordingly. You figure into that planning whether you go or not. I don't know the stats on how many free checking users use bank branches, but we both know it's more than zero. Same with phone service.

As far as the computer systems, those scale with number of accounts, not number of dollars. Given that the majority of accounts are likely to be free, or low net-worth accounts, it stands to reason that free checking customers make up a significant portion of the cost of operating these systems.

Re: The $36 soda: Overdrafting in America

#179

Post by fmavituna »

Two9A wrote: post #135
fmavituna wrote: post #129

Banking in UK is so ridiculous, beside of all insane overdraft charges when you enter your PIN incorrectly (Pin & Chip is mandatory in many EU countries) your bank charges you for £1

Would you happen to know which bank is doing that at the moment? In the last year, I've had a debit or credit card from NatWest, Halifax, Lloyds, Santander, MBNA and Barclays; never had an "incorrect PIN" charge though. If it's a new policy at one of those, I guess I'm closing my account...

This is Lloyds TSB and they've being doing this for the last 5 years, not sure why you haven't noticed (maybe you get it right every time :) ).

Overseas withdrawal can cost up to £4 and overdraft charges is can go up to £60 Lloyds not to mention they'll decrease your CC limit to £500 when you forgot paying £7.

Re: The $36 soda: Overdrafting in America

#180

Post by Hyena »

Confusion wrote: post #115
younata wrote: post #42

Earlier quoted context omitted.

This is precisely why I have USAA as my bank. I was originally going to get a Wells Fargo account, but that changed when I decided to go to uni in Florida - before the wachovia merger happened. My father decided that not being able to keep tabs on my account was a dealbreaker, so I ended up getting a USAA account. Worked out for the best, because USAA has some of the best customer service in the industry.

You're going to uni, but your father keeps tabs on your account? I don't know whether it's you or him, but really, you should both be able to trust you to take good financial care of yourself. It's an ability everyone needs and that you can't learn early enough.

That's pretty common. When I was in college, my parents wanted to keep tabs on the account they deposited working money in. It gives them peace of mind, especially considering the sums being discussed. The only time it ever came up was when I switched from take 15 hours to 22 and my burn rate shot through the roof.
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