The American public aren't aware that there are other fairer ways of dealing with overdraft if it should occur. The banks know, but choose to penalize and earn a short term profit than work with a customer to maintain a good relationship and customer retention and good will.
For the record, you should be maintaining a positive balance in your account so that overdraft penalties are not incurred. Here is a comparison between two institutions. I've chosen Bank Of America as an example simply because we have an account with them, and have experienced in proportionate overdraft fees. 1st POS Purchase made, sends account into overdraft by $20. 2nd POS Purchse made for $8 on the same day sends account into overdraft by $28.
Comparison: Bank Of America. 2 transactions causing overdraft = 2x$35 = $70 overdraft fee for $28 of overdraft. Comparison: Commonwealth Bank of Australia. 2 overdraft transactions totaling $28 incurs an overdraft fee of $0. Interest of 15.35% PA is charged on the negative balance. Calculated Daily. For me to correct my overdraft within the day, I would need to pay the overdraft fee : $0, and the interest accrued on $28 for 1 day which is negligible. The bank has allowed me to correct my problem quickly and both customer and bank are both satisfied.
If anyone knows of another US Based institution that DOES NOT work like Bank Of America and has a fairer overdraft policy, please share it here so customers of the banks that do support this policy have another choice. Again, you should keep enough funds in an account to cover with-drawls. However knowing that your bank is a little flexible and fairer means if there ever is a time when you overdraft by a little that you know you're not going to be penalized out of proportion.
3/24/2009. "Bank of America (BAC) recently agreed to pay $35 million to settle a class-action lawsuit related to overdraft fees. The lawsuit alleged that BofA authorized transactions that led to overdraft fees and posted transactions in an order that increased such fees. BofA, in settling the lawsuit, denied the claims and said that its policies fully comply with federal law. The bank declined further comment on the lawsuit." **
Bank Of America's overdraft policy: "What is an Overdraft Item fee? An Overdraft Item Fee is charged when you write a check or make a withdrawal for an amount that is more than the balance in your checking or savings account. If your account is overdrawn by a total amount less than $5 on a day, we reduce the Overdraft Item Fee and charge $10 for each overdraft item that day. (The standard Overdraft Item Fee is $35.) If your account has a negative balance for 5 consecutive business days, you will receive an additional one-time Extended Overdrawn Balance Charge of $35 on the Sixth day.
Although Bank of America is not obligated to pay an item if your account is overdrawn, the bank will pay these items as a courtesy to you. If you are charged an overdraft fee, you can view complete details in your Online Banking transaction record by visiting the link associated with this fee. "
Commonwealth Bank. The interest rate for the Streamline Overdraft is 15.35%* p. a. This may be subject to change. Quarterly loan service fee. Peak Debit During a Quarter Charge. Quarterly Fee. $0 : Up to $100. $9 : $101 to $500. $15 : $501 to $1000. $25 : $1001 to $5000. $35 : $5001 to $10,000. $45 : $10,001 to $20,000. $55 : $20,001 to $50,000.
Here's an interesting read: **. \6\ See, e. g., Overdraft Protection Hearing at 44. In contrast, consumer groups assert that overdraft transactions are a high-cost form of lending that trap low- and moderate-income
consumers into paying high fees. Consumer groups also state that consumers are often enrolled in overdraft services automatically without their request or consent.
In addition, consumer groups believe that by honoring overdrafts, institutions encourage consumer reliance on the service and therefore, consumers incur greater costs in the long run than they would if the transactions were not honored. Consumer groups note, for example, that historically, institutions declined a consumer's request for an ATM withdrawal or debit card transaction if the consumer did not have sufficient funds in his or her account.\7\
Today, however, institutions are more likely to cover those overdrafts and assess a fee on the consumer's account for doing so.\8\ According to consumer groups, this practice can be particularly costly in connection with debit card overdrafts because the dollar amount of the fee is likely to considerably exceed the dollar amount of the overdraft.\9\ In addition, multiple fees may be assessed in a single day for a series of small-dollar transactions. Because of these costs, consumer groups assert that most consumers would prefer that their bank
decline debit card transactions if the transactions would overdraw their account.\10\
This letter is in regards to the "Bank of America." I have had so many problems during the past several months that I just do not know what to do or were my rights are, or even if I have any rights! Back in April I noted some fraudulent activity in my checking accounts. I called the bank and had both of my checking accounts closed as well as my savings account and my debit card. I made the necessary phone calls to all companies who had automatic withdrawals rights. I then opened up two new checking accounts and one savings account, and received a new debit card.
When my social security check went in for deposit into one of my new accounts, it was bounced back to social security. After at least 5 phone calls, I was told by a representative one of the new accounts I opened (which happened to be the account that my SS check was to be deposited into) was closed for "unknown reasons" and the check bounced back to Social Security. I had to wait two weeks for that check. At the end of the month when my Disability Pension check was deposited, Bank of America also bounced that back. Again, I could not get any reason other than "I'm sorry, I can't figure out why this check was sent back."
Now, last week when my Pension was deposited, the bank deducted over $200 to put into that account that was closed, saying that I had several overdue bank charges because companies continued to try to deduct from it. One company whom I do not recognize tried over 5 times to deduct! I was charged all those $35 fees even though it had been closed for almost 4 months now.
I spoke with the manager of the Bank of America this morning and he told me the same thing that they have been telling me all morning - there was nothing they could do! Even though I closed out these accounts, I am still response for any debit that comes in to this account and any type of bank fee.
From April 4, 2010 to June 27, 2011 this bank charged me twelve (12) overcharge fees each of $35.00 amounting to $420.00 in addition to the $214.00 that was deducted today! As I said this account has been closed since mid April, 2011! This does not sound right to me. I know that some of the laws are unfair but I can't understand why there isn't a law against this! Why would I even close this account??
I hope that you can help me with this situation. I live on my SSDI and pension and I am still losing my home due to high increases in everything that we have been having. I cannot afford to give the bank $214.00 in addition to numerous $35.00 fees due to an account that has been closed since April, 2010. Thank you for your time and consideration in reading this letter. I hope that you can help me.
I heard about this on the TV this morning. Bank of America Limits Overdraft Fees, Offers Customers 'Opt Out'
Bank to Introduce Daily, Annual Limits to Help Customers Better Manage Their Accounts. CHARLOTTE, N. C., Sept. 22 /PRNewswire/ -- Bank of America today announced several changes to its checking account options and services that will help customers avoid excessive overdraft fees and better manage their finances.
"We want customers to have clarity and simplicity in everything they do with us," said Brian T. Moynihan, president, Bank of America Consumer & Small Business Banking. "We started with the Clarity Commitment(®) in Home Loans. Last week, we announced a simplified credit card offering that includes an easy-to-understand Basic credit card. Today, we are announcing changes to the way customers can manage their day-to-day finances that will help those who need it most right now."
The bank has already increased its specialized efforts to work with those customers who are feeling the impacts of the current economic environment. Additionally, beginning on October 19, the bank will: Not charge Overdraft item fees when a customer's account is overdrawn by a total amount less than $10 for one day. Not charge overdraft fees on more than four items per day. Improve the process for customers to opt out of overdraft capability. Offer customers a Clarity Commitment(® )that spells out in clear, unambiguous terms what customers can expect from their deposit relationship with Bank of America.
Effective June, 2010, the bank will: Introduce an annual limit on the number of times customers can overdraw their accounts at the point-of-sale when they do not have sufficient funds to cover their transactions. Contact customers who are nearing the annual limit to provide education and tools to help them better manage their finances. Limit overdraft capability, and therefore fees, for customers who reach the annual limit. Provide new customers the choice to opt into overdraft capability at account opening.
"Our immediate priority is those customers who excessively overdraw their accounts," said **, Customer Segments & Deposits executive. "With these changes, we have increased customer choice in the area of overdrafts, limited daily overdraft fees, and significantly reduced fees for those customers who need help the most. We will also increase our proactive outreach to customers to help them better manage their finances and limit their overdraft ability, if necessary. Over time, we will build on this strategy to extend additional clarity and choice to services we offer."
Bank of America has a long history of helping customers manage their finances, including account management tools to help prevent fees, such as alerts and mobile banking, both of which are offered at no extra charge. In addition, the bank has helped more than 3 million customers so far this year through Customer Assistance and fee refunds.
The Customer Assistance Program offers customers who lost their jobs or are in hardship immediate fee relief, waiving the monthly account maintenance fee for three months and refunding fees for non-sufficient funds or overdrafts. Mobile banking allows customers to receive e-alerts if their account balance becomes low. Since the launch of mobile banking in the spring of 2007, more than 3 million Bank of America customers have signed in to manage their personal finances "on the go." Online banking is helping more than 29 million online banking customers track and manage their finances.
Bank of America also provides tools and resources to help customers manage their finances through an easy-to-navigate Web site at www.bankofamerica.com/learn. Aside from the changes outlined here, all other terms of Bank of America's Deposit Agreement and Disclosures and the Personal Schedule of Fees still apply.
NEW YORK -- Unfortunately I used my bank card to purchase groceries and that purchase ended up over drawing my checking account. I didn't realize this until I checked my account online 2 days later. It showed I was $28 overdrawn. Seeing as that I get direct deposit and it wouldn't post for a few days, I borrowed money and planned on depositing it the following morning. I checked my account on line before going to the bank to make the deposit, and to see if by chance my direct deposit went through, it hadn't and it now showed I was $40 overdrawn. I rushed down to the bank and deposited $45, and got a receipt that showed I was now in the positive $5.
That was 2 days ago. I checked again on line to see if my direct deposit went through and not only had it not, it now showed I was overdrawn $100!!!! The order of my transactions showed my deposit of $45 posted before they decided to charge me $35 three times! I called the bank immediately and explained the situation to the customer service rep. I also asked her about the 5 day window. If you replace the funds within 5 days you avoid the $35 fees, she said "no", and that is for extended overdraft???? I am absolutely disgusted, now when my direct deposit does go in, who knows how much of my monthly disability check will be left for me to live on.
I have banked with Bank of America for years and I am extremely disappointed that this is how they treat a long time customer. As soon as my check is deposited, I will take out what is left and close all of my accounts with them! It feels good to vent, but it would feel better if they would waive the fees and stop stealing my money!
CHARLOTTE, NORTH CAROLINA -- In early October of 2009, my Bank of America checking account dipped below zero and I remembered I had overdraft protection, from my savings account. I made a mistake by not being more diligent, and for that I'm accountable. After a day or two, I noticed my overdraft protection was not being initiated, so I twice transferred money online from my savings to checking account. My savings had over $2000, so that was not an issue to cover what had happened. I then contacted a representative from the bank, and discovered that because my savings account was opened in Arizona, the overdraft protection was not valid.
Funny thing is, I've never lived in Arizona! It was a shock to me, and had never heard anything like this, nor did I read this in the account terms. After listening to the rep, she put me on hold and apparently spoke to an on-duty manager. I had explained to the representative that I thought I had the overdraft protection, and requested Bank of America refund $245 in fees. Once the representative came back on the line, she informed me that based on my belief that I had overdraft protection, they would refund all fees!
Now you can imagine my relief, and I was certainly embarrassed by my mistake and allowing my account to drop to low. The representative mentioned that the refund would happen on October 12th, yet I believe she forgot it was a holiday. I waited patiently and never saw the fees refunded. I called another rep, and he had me speak to a manager. I've never been talked to in such a way, where I felt like an insignificant customer, and the manager was incredibly condescending. I questioned why he could not pull the phone call, so he could confirm what the representative specifically told me.
I mean this is Bank of America, so why would overdraft protection be valid in any state. He could not explain why my overdraft protection did not apply, since my account was allegedly opened in Arizona, and I have never lived there! I am a full time resident in Texas! Instead of being accountable, he continued on with his condescending tone, and only refunded one $35 fee! I badly need the help, and I'm hoping this posting is a start. I felt like a small fish, in the oceans of a big bank. I will continue my fight to have these fees refunded to me.
PORTLAND, MAINE -- This bank is the greediest bank I've ever encountered. Recently my work made a mistake with the payroll file due to our company not recognizing Veterans Day Holiday and they got the direct deposit in late to the banks. Because of this I did not have my paycheck in my bank account when I expected it. Today people pay their bills by automatic payments and scheduled payments online so I had quite a few transactions that were going to go through no matter what I tried to do.
I called the Banks customer service and the girl told me they had the file and it would be posted by 5pm that day. She stated that this would not cause any overdrafts. I asked her if she was absolutely positive and she said 'Yes'. If she had not told me this I could have borrowed some money and gotten it into my bank account in time so I did not bounce any transactions. The payment file never got posted when the customer service representative told me it would be. I did have the money in the bank to cover a few of the transactions but Bank of America re-ordered the transactions in such a way so that they could maximize the amount of fees they would get.
I called the Bank three times along with my employer and they refused to work with me. This bank is awful and couldn't care less about their customers. I hope all their customers will leave them and they go bankrupt. I think they forgot who bailed them out after all. I've gone with a Credit Union now and dropped this bank account. The Credit Unions care more about their customers and will work with them at times when occasional mistakes happen. Shame on you Bank of America!
I have owned (via the bank) this home since 1988 and have never filed bankruptcy or had a foreclosure. I married in 1999. My battle with cancer affected my family's income and financial stability.
My husband and I have been in the MHAP since Oct., 2009. They offered a modification of 2.75 from 6.25. We applied and while waiting for our approval, the mortgage payment was 500 less per month, which is what we could afford. I have sent all the information they requested. In early March, the bank representative said that by March 15 we would receive an answer as to whether or not we would be approved. That date came and went. Instead, they requested an updated copy of our bank statements. I sent them initially in Nov. However, since the process is taking so long the ones I sent were too old to consider. So I sent new ones.
In the meantime, we kept paying the reduced mortgage rate. In late April, I called again to check and the representative said that my application was in the process of being closed. They could not tell me why. I asked why we weren't notified. They stated that they did not have to send a letter. That week I had to accompany my husband's family to visit his sister who had less than a month left to live. So I put this on hold until I returned home and called again. This time they told me that the reason is because we did not provide proof of my income.
To which I responded that I sent it in Nov., 2009. They said, "Yes, but the information has expired." They will assign someone within the next 30 days to review the paper trail which was contracted to another company. In the meantime, they sent us a demand letter for $12,000+. What more can I say?
In this era of hard economic times there is NOTHING worse than getting raped by your bank in overdraft charges. I've been a BofA customer for close to 20 years. And if I'm stupid enough to accidentally overdraw my account, I usually suck up the overdraft fees and promise myself to be more careful. What happened this month, is far beyond fair or ethical, in my opinion.
On the 15th of the month, I checked my balance online and had $956. in my checking. I knew I had an outstanding check( senior living rent for my dad)for $900, so I thought I would be OK until one of my direct deposits from one of my 3 jobs came through. Wrong! 2 days later, when the check came to the bank, I now had a negative balance and $245 worth of overdraft fees.
Yes, I had forgotten that I contributed $25 to the Presidents healthcare campaign, and yes I had forgotten about an automatic debit for a useless on line dating site, BUT... the bank resequenced all the previous transactions from earlier in the week, put the check in front of them, and caused 7 overdraft items at $35 each to occur on a $2.32 Dairy Queen purchase, a $3.18 Mc Donald purchase, a $3.36 Starbucks purchase and a $4.65 Hardees purchase.
All of these items had previously cleared but were resequenced from highest to lowest amount so the bank could charge for 7 OD fees instead of 2 or 3. What a scam!!! And then, since I only get paid every 2 weeks, they added another $35 fee for being overdrawn more than 5 days. What????
Is it my fault that the economy and housing market where I own a home collapsed? Can I help it that lenders gave mortgages to people who absolutely couldn't afford them, causing massive foreclosures in my area and dropping the value of my home $300.000. and making it impossible for me to sell my home, even though I'm not living there most of the time? No. But I'm doing what I need to do to pay my bills. so, when I'm working 1 full time job and 2 part time jobs at 54 years of age (with health issues) I get really PO'd that a bank I've been dealing with for years screws me like this!
Fortunately, a bill has just been passed in Congress to stop this unethical practice. And though I'm stuck eating these charges this time, you can bet it won't happen again! And there's a good chance I'll be shopping for a new bank! SOBSBE... sick of being screwed by everyone!
Approximately one month ago, b of a shut down my card on a Saturday thinking fraud was occurring. Although signed up for alerts, nothing came in on my cell or computer. My card was being rejected everywhere although charges were occurring. Finally reached fraud dept who assured me all charges would be dropped on Sunday nite. I checked quickly and thought they were all off. Fast forward two weeks and on September 8, 2009, I was charged for 9 overdrafts from a debit card, totaling 67 dollars total for the 9 charges. once again without any alerts from b of a.
Not knowing I was being charged, I did deposit 500 on the 9th thinking that I may be a little short and went on my way... that night I was charged an additional 5 overdrafts, totaling 25 dollars of purchases and charged another 170. I tried pulling money out on the 9th and the woman informed me I was going into the negative and there would be more charges assessed that night. I transferred 200 into the account and went home to check.
After 5 business days with over 1000 in account I paid 995 in overdraft and bank transfers. I went to the local bank where they were of no help and continued with the 800 #, which I have made over 25 calls to at this time. In looking at my paperwork I realized there were 3 charges totaling 15 dollars that were never taken off the two Saturdays before when they shut my card down... this could make all the difference and had to submit a claim. All the time my card and account is frozen.
Finally they return 620 a week later, credit me the 15 on that day and not when it should have been, and charge me another 70 in overdrafts. I call b of a again and finally spoke to someone who could see the problem and sent it back for emergency evaluation (stupid me did not write down her name or #). This was on a Friday nite and she told me it would be made right within 48 hours.
On Tuesday late afternoon still not credited and call again, no one can tell me who I talked with on Friday nite but sends it back to fee dept, they credit another 240 that day but refuse to take off the 70 od's that happened when they gave me the 620 and even though they owe me the 240. Would not drop the 70 od's. This bank is a complete joke and after 51 phone calls can say only one woman was helpful... instead I had to deal with lectures, ignorance, impatience, refusal to let me speak to anyone beyond customer service supervisor level. I really can't believe this bank has not folded yet and yes my account is closed and am banking at a local bank