New bank "tricks" to screw you...

steveinaz

You don't have to do anything wrong anymore to get screwed. It's very important that you read this article: http://finance.yahoo.com/news/Gotcha-Ways-Banks-Burn-You-cnbc-825417774.html?x=0&mod=pf-banking-budgeting

Why this BS is allowed to happen, I have no idea. Posting your payment 5 days earlier than you submitted it, to try to catch you in an overdraft situation?---unreal. WE helped save these banks.

Make sure to read through your bank statements/mail thoroughly; alot of these new "gems" will be hidden in the lawyer speak of those documents.

Face

It's simple actually. Thank a certain someone for taking on the banks(lowering CC fees, etc...). Now they need another way to make money.

steveinaz

Bottom line, all we can do is educate/protect ourselves. Watch your accounts. Maybe switch to a credit union?

cstmar01

There is really nothing new in the article though. All that stuff has been happening long before the banking world was being looked at more closely.

The taking the money out of your account prior to the transaction processing is a little different.

What they are probably doing is sending an acutal check to the company rather than an eletronic transfer of funds, because either the payee can not accept an eletronic transfer (such as smaller vendors etc). They then need to draft a check off your account and send it in the mail still by the date you have it due by.

This caused issues because well if the payment is due by 2/15 and you are just taking the funds out of the account on 2/15 its not going to get there if you have to send a check through the mail. Other problem then too is that a bank would be at a loss say if you set the payment up, then had to send the check on their own money, then you don't have it in your account.

They do have to disclose however what they are doing though with the funds and if they are going to remove them earlier than the date you put for payment. Often for example our system when we first had it did it this way, states funds will be taken out __ day and the payment will be to the vendor on __ day so you know when the money is coming out. Not saying this is the issue with them all, but it was an issue when our bank moved to the online bill pay system. People would want to set up a bill payment to say their mom and dad for something, well if your mom and dad's bank is a credit union and doesn't have an account set up with our vendor system, there is no way we can send the funds eletronically to them, so a check has to be created etc.


The rest, eh as long as you keep a balance and know what your spending, shouldn't be an issue. High to low transactions has been around for awhile, nothing new. Same with the debt card stuff. Just be smart, watch what you have for money and you should be good.

mhardy6647

cstmar01 wrote: »

The rest... as long as you keep a balance and know what your spending, shouldn't be an issue.

... and there you have it.

steveinaz

Manipulating when a payment is made, in an effort to cause people to be in an overdraft situation is WRONG. Let's not be so "nothing to see here" about this, that's how practices like this become "acceptable."

None of this affects me, as I'm with a credit union, and my financial "house" is in order; but I thought it might be helpful to pass along to others who are not. It's unethical and it is male bovine excrement.

cstmar01

Banks need to make money as well. It is a business. Like I said, its nothing new in terms of what the article is talking about.

Regarding high to low, yeah its annoying but once again, if you have enough money when you made the purchase it shouldn't be a problem when the money is taken out.

Also depends on when the merchant submits something for payment. Some places only do their processing 1 time a week, others 1 time every 2 weeks. Thats why there can also be a delay in terms of item processing. But once again someone doesn't write down what they spent, think they have it, merchant puts the item through and then its the bank's fault because we didn't process.

Never said its a good pratice or its right. Just saying that they are also a business and need to make money.

Is it right for best buy to sell expensive HDMI cables? no but they do, if you don't like it then don't bank with a bank that does that.

Not every bank is the same. They are not all out there trying to "screw" over the customer. The customer a lot of times does it to themselves, but again, people don't want to take responsiblity for it. Yes banks sometimes have stupid rules, blah blah blah, but its YOUR choice who to bank with, who to conduction business with, and what your doing.

If you don't want fees, don't OD, easy, but I guess for some its always easier to point blame that the bank is just trying to steal your money when it comes down as well to the user.

ryanjoachim

This is why I generally prefer to stick with smaller, local banks. You miss out on some benefits, but their overhead is usually a lot lower, so they don't nickle-n-dime you as bad.

tonyb

Looks to me like the old dino check writeing is still viable. Simple greed at work here. Get everyone doing the same thing and think of ways to extract more coin from them. We still have choices in banking though and if my bank did this, out the door I would go. Thats why it's good to have choices, in everything.

shack

The thing is...if you take care of your banking business...most of these fees will never affect you. It's all disclosed...READ what they send you and ask questions if you don't understand. Don't overdraft and you won't get an overdraft fee. Know what is in your account and don't exceed that when you use your debit card and you won't get an overdraft fee. Want a free account...find one...they are there...if that changes...move. I you have a minimum balance for no fee...put that amount in the account and act like it doesn't exist. If that is a problem...find a bank that offers free checking.

Pay attention to your account, make sure you know your balance, record and track ALL transactions, KNOW (don't assume) what/if the fees are for transactions...and most won't have any problems or get hit with excessive fees. It really isn't that hard.

bobman1235

First, if the article linked above is true, then people are not paying attention before responding. You could have enough money in your account, and STILL overdraft, because the payment you submit is not taken out on the day you tell it to be. I know you're all rich and whatnot, but some people get paid on the 15th of every month and thus have their car payment come out automatically on the 16th (for example). IF suddenly the bank started taking it out on the 12th... that would screw some people over. What's wrong with warning people "hey, this might happen?"

Banks are indeed businesses and no one should fault them for making money, but at the same time, even if they're abiding by the laws, they should be held accountable, from A CONSUMER perspective, for their actions. So if they're doing something unethical that is not illegal, there's nothing wrong with someone like Steve trying to warn people about what they're doing. YOu'd have to be some kind of colossal dick to think that warning people about bank practices is a BAD thing. Do you get pissed off at the ATM when the thing warns you taht there's a fee? How dare the consumer be educated?!

steveinaz

These are attempts by the banks to intentionally trip people up, plain and simple--people who (believe) they are doing all the right things. And AMEN to the comment that there are alot of people living paycheck-to-paycheck; guess what sector this kind of crap will affect the most? It's a cheapshot on the less educated (on financial matters--I don't mean that as a put down).

Does any of this affect me? Nah, I consistently maintain high balances---BUT just becuase I "get it" doesn't mean everyone else has the means to afford such protections.

It's male bovine excrement. Try to legitimize it all you want, but it's under-handed, unethical, and SHOULD be illegal. I'll never forget where I came from, hope some of you don't either.

WilliamM2

bobman1235 wrote: »

I know you're all rich and whatnot, but some people get paid on the 15th of every month and thus have their car payment come out automatically on the 16th (for example). IF suddenly the bank started taking it out on the 12th... that would screw some people over. What's wrong with warning people "hey, this might happen?"

Sad thing is, these tactics seem to target those that live paycheck to paycheck, and can afford it the least. Those with money in the bank have no worries about overdraft fees, so they don't see it as an issue.

steveinaz

I fully understand the concept of banks needing to make money, that's fine. DO IT IN LEGITIMATE WAYS. Charge an account maintenance fee, maybe small fees on electronic bill pay--but STOP ripping people off by hiding what you are doing in a 19 page, font size 1, lawyer-speak written booklet; and then manipulating when people make payments, to a different time frame so you can sucker-punch them with an unnecessary overdraft fee.

steveinaz

WilliamM2 wrote: »

Sad thing is, these tactics seem to target those that live paycheck to paycheck, and can afford it the least. Those with money in the bank have no worries about overdraft fees, so they don't see it as an issue.

EXACTLY William.

tonyb

WilliamM2 wrote: »

Sad thing is, these tactics seem to target those that live paycheck to paycheck, and can afford it the least. Those with money in the bank have no worries about overdraft fees, so they don't see it as an issue.

Yes and no, many keep little in a checking account mainly because it's not working for you. Alot will keep the bulk in money market funds or other investments that will put your coin to work for you, making more coin. A checking account is stagnant money. Those that keep large amounts in there aren't too worried about this, but then, how many keep thousands as a buffer in a checking account ? As said, you have to pay attention to your accounts, money unattended to is ripe for the picking.

Demiurge

In this case, you can't be screwed unless you're being an idiot. If you don't like the way your bank does business, find a better one or start stuffing your dead presidents under a mattress.

steveinaz

You have an auto-payment setup to occur on the 1st of every month, and next week without warning*, suddenly this payment is coming out 7 days earlier. This puts you into an overdraft scenario because you know you don't get paid until the 1st.

That makes someone an "IDIOT?"

Wow, but then again I'd expect nothing less from you.

*because this "new procedure" was buried on page 17, paragraph 4, sentence 2 of your font size=1, 19 page, lawyer-speak, new terms tucked behind your routine monthly statement.

vc69

steveinaz wrote: »

It's male bovine excrement. Try to legitimize it all you want, but it's under-handed, unethical, and SHOULD be illegal. I'll never forget where I came from, hope some of you don't either.

Exactly. These fees seem to be designed to extract money from the very people who can least afford it. Entirely unethical.

steveinaz

Those of you with less than a 6-digit income, please read the article and take heed. There's some changes coming down the pike that WILL be buried in a small statement (that likely, like most of us) you will miss. Us idiots do that from time to time.

Re-check and verify that your auto-debits wont put you in a situation where you may go into over-draft, if paid earlier than you requested (expected) initially.

cstmar01

The article is discussing the "wachovia bill pay system"

IE like I pointed out before, it would be the banks bill pay system through their internet banking, not ACH transaction you set up from like charter, direct TV ect.

The difference is that its a service that the bank offers to let you pay your bills straight from your checking account. You don't go to the other companies websites to pay.

If this was say an ACH transaction and they were pulling the funds prior say 7 days then yes, you have a problem, and its with the company who's website you set it up from.

Once again NOT regarding ACH, eletronic transaction that are set up as bill payments through another merchants website. From what the article states its their internal website which SHOULD WARN YOU WHEN YOU DO THE PAYMENT ABOUT THE DATE THE FUND WILL BE REMOVED.

If it doesn't, then the bank is stupid and don't use their system.

WilliamM2

tonyb wrote: »

Yes and no, many keep little in a checking account mainly because it's not working for you. Alot will keep the bulk in money market funds or other investments that will put your coin to work for you, making more coin. A checking account is stagnant money. Those that keep large amounts in there aren't too worried about this, but then, how many keep thousands as a buffer in a checking account ? As said, you have to pay attention to your accounts, money unattended to is ripe for the picking.

Maybe, but most of the people I know that can't afford to have a couple thousand in the bank, don't invest either. They don't have the money to invest.

Too bad I didn't have all my money sitting stagnant in my checking account, rather than invested, a few years ago. I'd be much better off. But that's a whole other subject.:frown:

ryanjoachim

steveinaz wrote: »

Those of you with less than a 6-digit income, please read the article and take heed. There's some changes coming down the pike that WILL be buried in a small statement (that likely, like most of us) you will miss.

Re-check and verify that your auto-debits wont put you in a situation where you may go into over-draft, if paid earlier than requested (expected).

I refuse to use a bank's "bill pay" or "auto-pay" features, for reasons just like this. I leave the auto-withdrawl to the companies that will be getting paid. That way if there is an issue, I can deal directly with them and not have to go through the whole "it's not our fault, it's theirs!" from the bank.

Demiurge

steveinaz wrote: »

You have an auto-payment setup to occur on the 1st of every month, and next week without warning*, suddenly this payment is coming out 7 days earlier. This puts you into an overdraft scenario because you know you don't get paid until the 1st.

That makes someone an "IDIOT?"

Wow, but then again I'd expect nothing less from you.

*because this "new procedure" was buried on page 17, paragraph 4, sentence 2 of your font size=1, 19 page, lawyer-speak, new terms tucked behind your routine monthly statement.

If you're in a financial situation where a bank drawing from your account earlier than you assumed is going to put you into an overdraft situation, you probably shouldn't have set yourself up for auto-pay.

You'll notice I didn't claim what the bank was doing was right, but it is legal. If a bank did that to me, I'd simply find a new bank.

The idiot is the one who just sits around and whines about how they're being screwed by everyone instead of taking a little personal initiative and personal responsibility by conducting business elsewhere or at the very least, in a more responsible manner given their financial situation.

I never allow automatic withdrawals. Personal preference. I want to tell businesses when they're going to get my money and forgo all the fine print. I can't get fuc*ed if I don't provide an ****.

steveinaz

You are an above-average financially educated person. That's my point.

Demiurge

steveinaz wrote: »

You are an above-average financially educated person. That's my point.

I get your point. Its going to screw those living paycheck to paycheck or those who aren't really paying attention. Its underhanded. I'm with you.

Maybe I suffer from thinking this is easy, but really, the only way these people are going to learn is getting burned a few times, like the kid who insists on touching things on a hot stove.

It doesn't justify what these financial institutions are doing. People just have to stop being dumb with their money. That's how you fight back.

If this was illegal, I'd have a completely different reaction. More laws and regulation just leads to sneakier behavior to make up what they lost by being more forthcoming.

cnh

True enough. Some of the members we have here are HARDLY representative of the average citizen who can barely balance a budget and, as has been pointed out, lives from paycheck to paycheck. The other question is HOW many OTHER options does such a person have when banks act like a 'herd'--all adopting similar non-competing policies?

Of course they have to make a profit. But again, HOW many banks do NOT make a profit? I don't think 'we' have to worry about them too much. They can look out for themselves and almost always do.

I've been on both sides of this equation. As a student, I continually LOST money to CITI bank of N.Y. because I could not maintain enough in my account not to be charged. What student could, except one being bankrolled by a wealthy Mom and Pop!

These days, my wife is over the online accounts like a HAWK. If any bank does ANYTHING she doesn't like they get an EAR-FULL and she doesn't let up! Good luck banks!

My point. And it is 'well' documented is that most people are not capable of protecting themselves or of even 'understanding' what we're talking about here. And they definitely don't or cannot read the fine print.

cnh

Demiurge

I had a Discover Card when I was 19 with a $500 limit and I thought it was awesome. Paying 17% interest was my wake up call. I was a total dumb ****. Now? Credit card companies pay me to use their cards.

shack

cnh wrote:

My point. And it is 'well' documented is that most people are not capable of protecting themselves or of even 'understanding' what we're talking about here. And they definitely don't or cannot read the fine print.

cnh

If that is the case we are doomed. It isn't astrophysics or molecular biology. It's simple math and simple reasoning skills. There are plenty of "watchdog" groups, both private and govt. that will help to explain it all if one cannot comprehend what they dealing with. Also, banks cannot do anything without regulatory approval. Even the language regarding notification of fees etc. is regulated and approved.

It is a matter of personal responsibility. If you don't like your bank...find another. If you don't understand something...ASK...or find out from someone who does. If money and the handing of it is as important as most seem to feel it is...one should make sure they understand everything about it. If you can't understand it all...deal only in cash. You would be surprised how many people actually do this. Not necessarily convenient...but doable.

I have no problem with people bringing up the issues and making them known. I am saying that people NEED to understand it all. My point is...poor or rich or somewhere in the middle...take responsiblity and understand and handle your finances. Most don't...and their problems are of their own making.

steveinaz

steveinaz wrote: »

Wow, but then again I'd expect nothing less from you.

I need to apologize for this comment, it was assinine and not at all relevant. My bad Demi.

steveinaz

shack wrote: »

It is a matter of personal responsibility. If you don't like your bank...find another. If you don't understand something...ASK...or find out from someone who does.

Shack, the problem is for many, they don't know what to ask. An example; when I started my new position in logistics 12yrs ago, the gal handing the warehouse over to me kept saying "how come you're not asking any questions?" To which I responded "because at this point, I too dumb to know what to ask.." "Keep briefing me, and I'll reach a point when the questions will come." Her operation was very different from accountable equipment warehouses I had worked before.