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ANNOUNCEMENT: Smart Money Needs Your Help on Bank Fees
By JLP | March 24, 2008
I received the following email this afternoon from Lisa Scherzer at Smart Money:
Hi JLP,
I’m a writer at SmartMoney.com. You helped me over a year ago with a story and I’m hoping you might help again. I’m working on a story this week about the rise in bank fees. Have you had any personal experience with these fees (higher stop-payment, ATM or overdraft fees, etc.) in the past year or so? Or maybe you can help me by posting a note on your site asking for input from readers about the fees. I’d really like to get some first-person account of consumers getting hit with fees at banks they weren’t aware of.
Any help is appreciated. Thanks.
Best,
Lisa
The only experience I have had with bank fees came earlier this year when I called about getting my savings account linked to my checking account for overdraft protection. I don’t ever plan on needing the protection but you never know. Anyway, the lady at Wells Fargo told me that she could help me and then she told me that if I do a transaction that causes the bank to move money for me that Wells Fargo will charge me$17! She then went on to tell me that that was a great deal because they charge something like $30 for an overdraft. She told me that if I move the money myself there’s no fee (well, that’s good news!).
If you can help Lisa out, leave a comment and I’ll forward your information to her. You might just get your name in Smart Money!
March 24th, 2008 at 4:47 pm
I actually wrote a blog post about this last week.
http://www.singleguymoney.com/2008/03/avoid-those-bank-fees.html
March 24th, 2008 at 4:58 pm
Hi - ATM fees are going through the roof. That is one of the fees that the bank can say “Gotcha” when you go to the ATM; don’t have a lot of time; and you suddenly find that, because your ATM card is a foreigner, they can nail you. It is only a small amount per transaction so you pay it and grumble. However, when you add it up for all “foreign” transactions, it is a chunk. A BIG chunk. Citizens Bank leads the pack, here, having raised it from about $2.00 to $2.75.
I remember seeing a Senate Finance Committee a few years back. The Senator from North Carolina was questioning some Yankee bankers. Paraphrasing the Senator’s comments - Lemme see if I understand this. I put my money in your bank; you loan MY money out and make more money; when I tell you I want some of my money back, you charge me money for taking it from your bank. Is that about right?????
March 24th, 2008 at 5:50 pm
Bank of America started charging me $9.95 a month suddenly a while back on my checking account. I couldn’t figure out why until I started reading the small print in the account details and found a clause stating that they would charge you for using the online account features of MS Money or Quicken.
Once I figured that out, I figured it would be ok, since I wasn’t using the programs anymore, but the fee showed up the next month again. In fact, even if you only download your transactions one single time, you will get this nearly $10 charge every month until you call to have them stop it!
It took me about 2 hours on the phone to finally get someone “authorized” to stop it, and since I was living abroad at the time, I didn’t bother to switch banks in the US. Since I haven’t been hit with any other fees since that reoccurring one, but it sure did make me mad at the time.
March 24th, 2008 at 5:56 pm
AlB, I drove around town looking at bank fees since I needed to convert Euro to USD (turns out ATMs are the cheapest way to do it, btw.). I probably looked at 25 different banks. The fees ranged from several places with no fees to up to $3. $3 for an out of network transaction! Plus your own bank probably charges you an additional dollar or two for using someone else network!
And while these ATM fees really irk me, it really bothers me that Congress is sticking their nose into it. The free market works…yes some banks are charging ridiculous fees, but plenty of other banks charge no fees. If congress started mandating that ATMs couldn’t charge fees, then there wouldn’t be so many ATMs to choose from…. please Congress, let the free market take care of it. As long as the bank tells me I am stupid and am paying $3 to take out $20, that’s fine…
March 24th, 2008 at 6:33 pm
Recently I was charged a $10 “returned deposited item fee” because I deposited a check from a company who issued checks with wrong routing numbers. Punchline: the company sent me a new check, with the correct routing number, and compensated me for the fee. But even though things worked out for me, I still have serious doubts about the validity and fairness of this fee.
The bank hopes that by charging a returned deposited item fee, depositors will take the time to verify that the checks they deposit are legit, thus saving the bank time, effort, and money in processing returned or fraudulent checks. However, this fee is levied on depositors, not the people writing checks that will bounce.
I think the fee places punishment where it’s not deserved. The depositor can ask the check writer if he or she has funds to clear the check, but at some point the depositor must take on faith what the check writer claims. I can’t force the company I mentioned to ensure that it doesn’t misprint a number, or force anyone else to have enough money to cover a check, or force someone who doesn’t have the funds to tell me the truth about their insolvency.
When a bank tries to clear a check from another bank, if the check bounces, the bank which originated the check should ding the check writer. Perhaps the first bank can recoup some of the expenses of this process by getting a share of the second bank’s fees. Banks work hand-in-hand all the time; they can figure it out. They shouldn’t, however, charge depositors who have to trust check writers in good faith.
By the way, I have no problems when my bank puts checks on hold until they clear. I’m fine with this, and I totally think this is a necessary measure to prevent people from knowingly depositing fraudulent checks. It’s the extra fee, on top of the hold period, that really got my goat.
March 24th, 2008 at 8:38 pm
ATM fees are a rip-off. An ATM transaction costs the bank way less than a transaction using a human teller. I recently left Wachovia (who I was fairly satisfied with) for Eastern Virginia Bank, a local bank that has been around for many decades. As long as I meet their minimum requirements of 1 direct deposit & 10 check card transactions per month, and get my statement online, they give me 3.99% APY on my checking and refund other banks ATM fees that get slapped on if I use my card to get cash at another bank.
March 24th, 2008 at 9:56 pm
I go through a local bank and don’t have any problems with more fees. I once let my account get over drafted by several items that were automatically taken out and because of the order they were listed it hit me with 3 charges of 25 dollars but when I went to the bank and explained that if the order was different (since it was the same day) they only charged me once. After that I had my checking tied to my savings and as long as I have 100 dollars in my savings I don’t get charged for the account or having it used as back up for my savings. 3 out of 6 local ATMs will charge me a dollar or two but the others are free.
March 24th, 2008 at 10:09 pm
I had a similar experience with overdraft fees. My bank (Rhymes with Fifth/Third bank) had a CC attached to my checking account for overdrafts. The CC charges 19.9% interest. No big whoop it’s a convenience. Three years ago, I get a notice that my overdraft will also charge a $2 fee; still not a major issue it’s a convenience. Now I get notice that my overdraft fee is now $19. Also when the overdraft kicked in, they used to deposit in increments of $50 dollars; now the ‘protection’ deposits are to the penny, so they charge the $19 + interest for every overdraft you make. I’ll be looking for a good credit union soon.
March 25th, 2008 at 8:08 am
A couple months ago I scheduled a large online payment from my checking account to pay off a credit card. I inadvertently scheduled the payment to be processed the day before my paycheck was to be direct deposited, and it resulted in an overdraft situation. My bank charged me 5 non-sufficient funds fees totaling $175! Three of those fees were for small checkcard transactions that had been processed and approved days earlier, but had not yet “posted” to my account.
I visited a local branch, hat in hand, asking for some mercy. I even offered a compromise. Since it was my mistake I offered to pay $70 in fees for the online credit card payment, and one check which happened to hit that same evening. However, I did not feel it was fair to tack on the remaining three charges (an additional $105) for the checkcard transactions because they were technically processed when money was available. It took several rounds of convincing, but I finally received credit for all but two fees. In exchange, I set up a savings account with no-bounce protection to prevent future occurences.
March 25th, 2008 at 8:34 am
Hi, here is my experience with ATM fees. I do my banking with Bank of America. Here is how currently BoA Works: If I use any ATM other than BoA’s, I will pay that ATM fee of that particular ATM (as I’m not form their bank) AND Bank of America will slap me with ANOTHER $2 for not using their own ATM. This set up pissed my off a lot in the beginning, BUT over time I got used using only BoA’s ATM. And this works, no matter where I go. I live in CT, but had no problem finding BoA’s ATM in Las Vegas, Miami, Los Angeles.
So I don’t have that problem anymore because:
1. I got used using ONLY BoA ATMs.
2. Bank of America has ATM’s almost on any corner.
I didn’t have an issue with overdraft fees. I know they age huge. BUT my last overdraft was more than 2 or 3 years ago. So I don’t know for sure the exact amount. These overdraft fees made me learn to pay more attention to everything that is coming in or coming out from my checking account. And if I have a shortage I just simply transfer money from my saving. All could be done online. I check my accounts everyday.
There were few instances when my account went negative (my bad). But I think as long as transaction is showed as pending you have time to transfer funds from any other account, bring it pack to positive balance and you won’t be charged with overdraft fee.
I understand that a lot of people don’t like overdraft fee but my take on that is “learn to balance checking account”. Isn’t this one of the basics of being financially responsible?
P.S. Side note. I didn’t go to the branch itself for more than 1 year (or more, can’t say for sure). All my banking is done either via online or ATM.
March 25th, 2008 at 9:01 am
I’ve all but canceled my wachovia account due to the Quicken fees they tried charging me. I had the same experience as the first poster to mention this (aside from being out of the country)… BS.
March 25th, 2008 at 9:34 am
We recently refi’d our house and there was a small amount due back to us (about 1,800). We filled out the paperwork to have this directly deposited in to our checking account. We provided a copy of a void check, routing number etc.
The amount came through, but the bank also charged a $10 wire transfer fee. For some reason they deemed this deposit as a wire transfer rather than a direct deposit (like our paycheck and tax refunds). I called 3x and asked them to remove it as I’ve been a long time customer and didn’t realize that it’d be treated as a wire transfer rather than a dir. dep.
They refused to remove it. I’m tempted to switch banks, but I have too many electronic payments already associated with my checking that it’d be a hassle for just $10.
The bank is WAMU.
March 25th, 2008 at 11:25 am
Ditto the Wachovia fee of $4.95 a month (or so) for Money or Quicken accessing your bank records. It used to be free with my Money 2004 software, and then I got a postcard in the mail telling me they would soon be charging for this “service”. Having my Money program access my online information instead of me manually inputting each charge is a service?? Not worth it. So, I immediately deleted all “online setup” info for Wachovia in my Money program and thought that was the end of it. Then I got charged with the fee anyways the next month. I called to complain about this, since the postcard did not in any way offer CLEAR instructions on how to avoid the fee. I was refunded the fee, but man, was that SNEAKY!
Second: Not to complain, but more to highlight…ING Direct’s Electric Orange has a fee which I find questionable. The account bans you from writing paper checks. You have to do things electronically or have THEM send a paper check. That’s all fine, except when you need to have a check sent immediately. They write and send checks the next business day for free, but charge you $15 if you want it overnighted to the recipient. A little harsh given the fact they ban paper outright so I can mail it myself. The alternative, writing an e-check, is dependent on the recipient trusting you enough to hand over their bank info so you can do a transfer.
March 25th, 2008 at 12:22 pm
My bank is Wells Fargo so all these gripes concern them.
1. ATM fees are a ripoff - similar to BOA in the comments above. I don’t have a problem paying a fee to the owner of the ATM since they have to buy, stock and maintain the machine. Paying a fee to my bank for a withdrawal from a foreign ATM, however, is a pure ripoff. It is purely an electronic transaction that costs them nothing.
2. They sent me an offer that electronic bill pay was not free, but going to the website I found that it is only free if you maintain an account balance of $5000. Otherwise it is 6.95/month. Again, it reduces the banks costs to have me pay electronically rather than write checks, so why the charge?
3. A teller convinced me to convert my mother’s checking and money market accounts to a PMA account, saying that she would get better interest on her money market savings. When her account balance dropped for a few months they started tacking on a $25/month service fee. Of course, there was no mention of that when the account was converted.
March 26th, 2008 at 6:57 am
Bank fees have become ridiculous. I use ING Orange to pay all my bills because there are no fees. I use a small local bank for my FREE checking account because there is no fee associated with using the Overdraft Protection. I switched banks BECAUSE my old bank started charging for Overdraft Protection transfers.
I know I’m a bastard, but I would GLADLY change banks and re-setup all my electronic transfers to save $5 a month in fees. (I have done just that 3 times already)
I also absolutely refuse to use a foreign ATM machine. Saving $3 is worth a little extra driving.
March 27th, 2008 at 5:54 am
I work for the NAB (National Australia Bank), and on most of our accounts there is a $2 fee for using a non-nab atm, but we do have an account which is $12/month, but allows unlimited non-nab atm usage and even international atm’s.
When I was a teller, it wasn’t uncommon to see people rack up over $30-$70 in fee’s a month.
And we even have accounts with no exception fee’s (overdrawn etc) for only $6/month, but we do limit overdrawing the account to the best of our ability, so basically you can only overdraw it if one of the systems is down and won’t communicate with the processing bank.
And these monthly service fee’s are can be waived if your have your salary credited to that account.
So it really does pay off to go into a branch and ask a teller or one of their staff members about the accounts on offer as they will be able to work out what is most suitable for your needs, and they usually are normal people just like you and me that actually aren’t out to slug you for as many fee’s as possible.