On the contrary, you appear to have not been keeping track properly, or you wouldn’t have overdrawn.
Every bank I’ve ever done business with has clearly stated their fees when I opened the account. It sounds to me like your account had a monthly service fee which you neglected to account for, and your withdrawal overdrew your account. How is that anyone’s fault but yours?
OK, my initial snark aside, I will say that this is not an explanation with which I am unfamiliar. In a case where the account lacks overdraft protection, I might even buy it. That said, in a case where overdraft protection is present, this practice it a load and is obviously designed to earn the banks the maximum amount of fees possible.
I am going to dismiss your “don’t spend more than you have” comment as reductive and simplistic as basically every aspect of our consumer society is designed to make that very difficult to do.
The simple truth is that banks have stacked everything in their favor, and no one is doing anything to protect the consumer. A perfect example is this newish thing where checks I write can electronically clear immediately.
Now don’t get me wrong, I never knowingly will write a check that can not be covered by funds that very instant. However, why is it that a business can get my money right away, but if I deposit a personal check written to me the bank can clear it the old fashioned way? Obviously the tech exists to process it at once, so I have to conclude that they are doing their best to make those folks on the margins bounce transactions.
Yeah, but I’m pretty sure I don’t get charged even for that.
If they are ordering by amount, then they clearly have all the transactions in front of them and can see that the total is going to cause overdrafts. Arranging them so that the maximum amount of overdraft fees is applied is incredibly underhanded.
iamthewalrus(:3=, You misspelled “In order to better serve you”.
Mr. S and I have separate his-and-hers checking accounts. Each one has an extra $200 “cushion” that sits in the account to protect against this kind of thing. We “write it out” and it’s not included in the check register balance – for example, right now my register balance is about $50, but there’s really $250 in the account. We just remember to add it back in when balancing.
Mr. S is a sloppy bookkeeper (balances his checkbook every few months, doesn’t worry about exact math) and I am not (balance every month, hunt down math errors), and I can’t recall the last time either of us had an overdraft. (The cushions have also stood in as emergency funds now and then – we just make sure to put them back ASAP.)
Not an option for people who can’t spare the extra cash, but I thought I’d throw it out there.
I’ve been “overdrafted” twice, once in Spain and once in the US.
Spain: bank knew I’d get my salary direct-paid in two days, so they held onto the phone bill until I’d been paid.
US: on the same day, I got direct-paid and two charges (cheques I’d written for people who didn’t understand the whole concept of direct charge). If the bank had counted the direct-pay first, I wouldn’t have been on overdraft. If they had counted the small charge first, then the large charge, then the salary, I would have been on overdraft once. So, of course, they did it in the way that got me to pay overdraft twice. And the three lines were all listed within seconds of each other 
The Spanish bank was under no obligation to do what they did (mine does it as a special service for people who use direct-pay), but the US bank people sure got themselves some bad karma that day.
Yeah, I found out the hard several-hundred dollar way that a bank will gladly let you keep using your ATM and debit card all over town without at single penny in your account- at the modest fee of $60.00 a transaction.
But hey, it’s better off than my boss, who emptied an account but somehow ended up not officially closing it. The $2.00 monthly fee ended up costing him $50 in overdraft charges.
Banks should be required to clearly disclose any and all chances that you will end up paying them money. No other business has direct access to your bank account and can help themselves to whatever they like without you knowing, and then charge you for the privledge when you run out of money. And it seems like there is no other business where the fees stack so quickly and one mistake in paperwork that doesn’t actually affect the bank’s operation can cost hundreds and hundreds of dollars.
I blame the banks for charging people $32 for a transaction it only costs them $2 to clear. I used to edit a banking publication, I know what I’m talking about. The articles than ran in the publication put it in terms of “maximizing fee income.” And of course the people who are hurt most by it are generally not wealthy spendthrifts who can’t be bothered to keep track of their finances, but poor folks who are trying to “float” checks so they can buy medicine when it’s needed instead of when the retirment check comes in.
I have no patience and no sympathy for assholes who will excuse any crappy-ass behavior by a bank because doing so gives them a frisson of moral superiority over those less fortunate than them.
Up until a year or so ago, I was one of the less fortunates and lived paycheck to paycheck and you know what? I still managed to NOT overdraw my account. How did I do that? By making sure I didn’t write any checks, or use my debit card for amounts that would put me over.
As far as I know, every bank charges overdraft fees, and they state what they are upfront. After that disclosure, the responsibility is yours. If that makes me “morally superior”, then so be it.
But that doesn’t change the fact that if one is not writing checks they can’t cover, it doesn’t matter what order they are processed. If you have check X and check Y and only have enough to cover check Y, how is it the bank’s fault you bounce a check because they process check X first? So what if it’s the higher amount - you are supposed to have enough money to cover every check you write.
If you don’t have enough money in your account at the time of writing the check, and then subtract it from your account balance at the same time, it is no one’s fault but your own if you incur overdraft fees.
The second $33 charge for the $2 ATM fee is just wrong. It might be legal, and it might be written in fine print somewhere, on something you signed when you opened your account, but it’s wrong. The withdrawal and the ATM fee should be considered as one transaction.
Why aren’t they? Is it because one institution handles the account and another handles ATM fees, sort of a middleman?
Mauvaise, Look, I don’t think that anyone is arguing that folks should get a free ride when they are writing checks with money that they don’t have. Further, no one is trying to say (that I can see) that if you are aware of your financial situation that the blame for the overdraft is not your own. However, the fact remains that it happens from time to time.
I am gratified to hear that you are not living from paycheck to paycheck, and impressed not only that you have established your “I know how it is to be poor” credentials, but that when you were poor you never bounced a check because you were so fiscally responsible. Kudos.
My problem really boils down to the fact that they banks are out to screw people out of as much money as they can and that this creates a negative feedback loop that is one of the many factors that helps to keep people poor. Again, if the bank just wants to be logical and cash things in the order that they are received I have no problem with that. It would be good customer service to cash them in such an order as to clear as many transactions as possible. The way that things are set up now is not only bad customer service, it is not logical (this whole “we want to make sure your mortgage clears” argument is transparent bullshit). I don’t think that it is an outlandish request that our financial institutions be either logical or give good customer service. Perhaps they will become one or the other, if only they get a few more billions in profit.
Unless you’ve written checks that haven’t cleared yet and will of course try to clear the night of the withdrawal, before the deposit clears. Of course I took out money once, the check to my Grandma bounced overnight and she started to worry about my finances! Vaguely like Seinfeld and his nana and the Chemical Bank.
I’m lucky because mine is an employee-owned community bank and will be somewhat more flexible. I think the one time I overdrew (check float issue probably) they could see that my direct deposit was coming up within a day or two and let it go.
Personally, I think this is a stinking heap of B.S. by the banks. I never bought this explanation and I really do think the banks are there to screw you with the overdrafting fees.
Put it this way, the way my bank works, because I’ve been such a long-time customer, they cover my checks when I’m NSF. Normally, they said they would simply not pay those checks but, as a service to me, they pay them and stick me with a $35 fee. Now, if those checks had bounced, I’d get stuck with a smaller fee ($15-$25).
I had one weekend a few years ago where I took out money when I actually had it. Except for the last transaction (on a Sunday) which was an ATM withdrawal for a larger amount. So, even though the computers keep track of the chronological sequence and it can be proven than when, after business hours on Friday, I made a withdrawal for $20, bought some gas for $20, then on Saturday bought a book for $20, and on Sunday withdrew $200 (putting me $65 under, apparently). When it was processed on Monday morning, the SUNDAY withdrawal went through first (because it was the highest, and because apparently a Sunday transaction is the same as a Friday transaction to these banks) bouncing the three previous transactions along the way. Over a hundred dollars in fees.
Now, how in holy fuck am I supposed to know that I can’t trust my ATM receipt’s balance and the esoteric rules of bank accounting? If I make a withdrawal on Saturday, the logical thing to assume is that this transaction will be processed before the Sunday one, isn’t it?
The only reason I can possibly see for these rules is that the banks make off with the most $$$ this way.
MindWanderer, I suggest you call the bank and complain about the overdraft. If this is your first overdraft, they will almost certainly waive the fee as a courtesy. I have never heard of a bank that did do so. Personally, I’ve gotten my bank to waive over $400 in overdraft charges over the years, so I can’t really complain too much about my problems. (And now, being financially stable, it’s not really a problem anymore anyway.)
I don’t fuss about my bank charging me an overdraft fee if I overdraw, but I think the point of the OP is that the bank charged TWO overdraft fees for one overdraw. No one is advocating irresponsibility here, and I think the OP has a perfectly valid point.
As to having a nice smug standard about not spending what you don’t have: Life happens, and sometimes things have to be paid for regardless of the balance in the bank. Right now I have a car in the shop that is going to cost me $400ish to retrieve. I can either write a check that will cause an overdraft and will cost me the $27 OD fee, or I can leave it in the shop and lose my job, because there is NO other option here. No one to borrow from. No emergency funds. No savings bonds to cash out, no 401K, no life insurance to borrow against, nothing worth selling, and no other car to use. So I’ll write the check and get it covered asap (early next week, when my paycheck arrives), and keep plugging away to cover the shortfall in my other bills caused by having pay for repairs to the damn thing in the first place.
Life happens, and sometimes it just keeps right ON happening, seems like.
If you use your ATM receipt balance as a way of managing your bank account, then you deserve every overdraft charge you get. Without verifying your balance against all transactions that haven’t cleared, your ATM balance is worse than useless.
As for these “esoteric” rules of banking…well, did you not bother to read the disclosures on your account when you opened it. This shit isn’t rocket science.
If you write checks or make withdrawals against money that isn’t there, things haven’t been paid. If you are relying on some float time and it bites you in the ass, I’m assuming you suck it up and absorb the penalty without complaint.
As for all of the people crying about how banks are ass-reaming you with their fee maximizing policies…you do realize that banks aren’t charities, right? Show me a single business that doesn’t structure its business plan to make money, and I’ll show you a business that’s headed for failure. Why it’s coming as a shock that banks want to make money off of you is beyond me. Don’t like the fees? Well, like I said…either stop spending money you don’t have, spend the money you don’t have and suck it up when you get dinged, or take your business elsewhere.
Christ on a pogo stick! Banks aren’t charities? Well knock me down with a feather!
Again, the objection here is just to the transparent sleaze.
In my fantasy world, Sunday comes after Saturday, which comes after Friday.
There is absolutely no logical reason the bank would choose to ignore this fact, when they have computerized equipment that can record accurate time- and date-stamps, other than to make more money for themselves.
And I can’t find anything on my banking agreement that says checks are processed in high- to low- order, or that all transactions after hours on Friday, Saturday, and Sunday all count as being made on the same day, and thus are processed in high- to low- order. Plus, when I signed up with my bank, it was NBD. Then it became First Chicago. Then it became Bank One. Now it’s Bank One, but really Chase. They keep changing the rules on me, so it’s no wonder I can’t keep up with all the esoterica. And I’m pretty certain when I was banking with NBD, they processed my checks the other way around, and they definitely DID bounce my checks instead of covering them and claiming an overdraft fee.
Once again, it doesn’t really matter to me, as I’ve been refunded almost all my fees.
Another time they closed my account for almost no reason at all. Apparently, someone somewhere along the way flagged my account so that if it reached EXACTLY $0.00 it would automatically close. I never agreed to this, and no one was able to produce any evidence in writing anywhere in the contract that spelled this esoteric point out. If I was a cent under, they would have charged me an overdraft fee. A cent over, and I’d be fine. Since, through sheer coincidence, my account hit $0.00, it closed. It took me two weeks to sort out (I was living overseas) and borrowing from my friends so I could desperately deposit a $2500 into my account.
You make it sound as if the banks are never at fault. I accept responsibility if I make an error. I would take responsibility for the overdraft fee on the Sunday withdrawal. That was honestly my fault. But I think it’s absolutely ludicrous to suggest that I should have known the Saturday and after-hours Friday transactions would not have been processed first when they’re electronically time-stamped and processed.
You are slightly misunderstanding what Check21 is. Just for the record, I worked in a bank, and we had to train for Check 21.
The technology to clear these checks faster is not in the banks’ hands. It is in the hands of the grocery stores, the doctors’ offices, etc–wherever you pay your bills. Yes, the banks have the receiving software–but we cannot actually use it to process your paycheck (unless you already have direct deposit which is set up with both us AND your employer) or your personal check for Mr. Joe Blow who banks at 2nd National when your account is at 1st National.
We cannot do this because of security/privacy measures at both banks. Not only do we have to put a hold on it (sometimes, not always) when we put it into your account, the other bank has to check it and make sure there’s nothing wrong with it as well.
The reasons a hold can be placed on a check are myriad, but they have nothing to do with Check 21. Some possible ones can be:
You’re prone to overdrawing your account and you usually have a very low balance, but this is a high-number check. That doesn’t always happen, but it might.
You are suspected of illegal activity.
The check has already been returned insufficient once and is marked as such.
You are new member at the bank/credit union and therefore are possibly a scammer.
The check is exceedingly large, and does not fall under the umbrella of checks available next day.
The bank is not trying to rip you off when we put your checks on hold. We are trying to protect, in some cases, your money, our integrity, and other people’s money.
Dammit to hell, that was me. If my husband doesn’t start logging off after he’s finished I may have to…stop cooking his dinner!