Monty, what the hell is your problem?
She’s obviously not as irresponsible or dumb as you make her out to be. So what gives?
Okay. I’m tired, so I’m going to get the first part out of the way early. It’s an honest, genuine question directed at Libertarian, Doctor Jackson, Jodi, and Bricker, along with anyone else who has been helpful and/or happens to know.
I was thinking about it at work for the past 10 hours or so and just am confused/curious about one thing.
Jodi said:
Okay, I understood that initially, it made sense.
But then I started thinking. In this situation, it’s not really the cheque card that was the problem, it was the cheque that “I” wrote for $200. The cheque-card purchase has already cleared, right? So when the cheque itself comes, can’t the bank stamp that “NSF” and return it to the retailer? They’ve cleared the cheque card purchase so there’s no liability for them there, plus they get the added bonuses of being not liable for the amount the cheque was written for (that gets stuck to the retailer - and then to me - if I am reading others’ - maybe Dr. Jackson’s or Bricker’s? - posts correctly), as well as the fee to me for switching money from my savings account to my cheque account to cover the amount, and whatever other overdraught fees they can assess on me.
Now, also, what would be the difference between the quoted situation above, and the following?
Irresponsible Sue writes a cheque for $200 on Thursday, not certain if she has the money in her cheque account to pay for it. On Saturday, she goes down to the ATM machine and withdraws $20 from her cheque account. The machine, not sentient, perceives that she has $50 in her account, not realising that she has a cheque for $200 floating around out there, and thinks, “Hey, she’s got enough money to cover that $20,” and spits it out, now stating that she has $30 remaining in her account. Irresponsible Sue then goes to the CD store and buys a CD. On Monday the $200 cheque clears, and her account is now severely overdrawn. What recourse does the bank have?
As far as I can tell - and I am admittedly unknowledgeable in the way of banks or ATM machines despite having seen the clear-backed ATM at the Boston Science Museum some time ago - the ATM transaction goes through before the cheque clears, so the ATM transaction is covered, and the only transaction that is problematic is the cheque. The bank can then stamp that cheque NSF and send it back to the retailer, right?
Or how about Idiotic Joe, who writes a $200 cheque on Thursday night/Friday morning, and on Friday afternoon goes into the bank to withdraw money from his account. He asks for $20 from chequing and the teller looks in his account to see if he has that money. He does indeed - she sees that his account has $50 in it and she is, although sentient, not prescient, so she does not know about the cheque he wrote that has yet to clear. She gives him the $20, leaving his balance at $30, and he goes off to buy his CD. Later that day - or perhaps Monday - that $200 cheque clears and his account is now seriously overdrawn. Et cetera.
It seems to me that the problem is in writing paper cheques - there is no way for the cashier/business accepting them to check to see if there is enough in the account to cover that cheque, and there is no way for the bank to know a cheque has been written - thus no way for them to update the account information - until the cheque is sent into their building. Yet cash and ATM machine transactions go through instantly, and only if the money is available at that moment for use.
Wouldn’t it really be safer for the bank to revoke my cheque-writing privileges (this is hypothetical here, I don’t think they can really do that, but I’d give them every chequebook I had if I thought it would help me out here!) and give me a cheque card? I couldn’t use the cheque card unless the amount I wanted to pay was less than the amount I had in my account at that moment, and I couldn’t have written any paper cheques to screw things up, so barring any sort of tricky problems with the reservation/accounting programs the cheque-card-swiper-machine-thingies use, I should never be able to overdraw my account. And to eliminate the problems with the accounting machines, make them update as swiftly as ATMs do, and voila? Problems solved?
Please tell me what is wrong with this, because I can’t see anything, and I’m getting my hopes up for a Nobel Peace Prize here, for putting an end to NSF cheques and bounce fees! 
redtail23 - I was not kidding when I said my bank was staffed by demons waiting to suck your soul. They are evil. Evil evil evil. They didn’t even allow me to have an ATM card until I was 18. My parents used to bank there and the bank has screwed them over many times with transaction mistakes; the only reason I am still there is because there isn’t another convenient (location-wise, obviously) and low-fee bank in the area that I’ve found. I may find myself switching to the Postal and Federal Employees’ Credit Union actually, if only they were anywhere near the parts of the city I frequent. 
Goo - Yes, I love the exchange rate! 
Like I’ve said I don’t have a problem with paying for the trip, I’ll have more than enough money by then plus I’m getting paid to go (gotta love paid leave!). It’s just that I really don’t want to have to go through the hassle of writing a cheque in a foreign country, or holding onto a bazillion travellers cheques.
And I’m going to be there from Jan 21 to Feb 23. nods
Oh, and I’ve been spelling this way - “extraneous” u’s and all - since I was 13. It’s far too much of an ingrained habit to change now, even for America’s sake. grins
monster - I’ll probably end up getting a credit card, I’m just really not enthused about the application and annual fees. Blech. It probably is worth it to build up my credit though. I’ve been wanting a credit card forever now, for no other reason than to buy gas and pay the bill off in full each month. That’s my strategy, anyway. I don’t do much impulse shopping, so I’m not worried about suddenly turning from conservative spender to “Charge everything!! 
:D” or anything like that. shrugs
But man, paying $96/year for a $300 credit line just makes me wince!
And now on to my favourite, Monty.
I kind of thought it was taken for granted, and obvious, that the failure to pay said bills on time was what caused the credit problems. I don’t believe I ever said any differently. I never said I wasn’t liable for the school bill, the car insurance/damage bill, nor the eviction. Nor did I ever say that I had a problem with the creditors’ decisions to pursue their money. I expressed the reasons why I failed to pay those bills on time because they still frustrate me, I felt they were pertinent to my rant (as just saying, “I didn’t pay this this this this and this” would leave people open to thinking that I just didn’t want to pay, and that’s that) and I was pissed when I wrote the OP, and I was tired too, some jerk with a chainsaw was sawing down trees in my backyard at 8 a.m., and for a person who works second shift that is very difficult to deal with. In short, I was on a roll and those were fun things to share. I felt much better when I was done typing.
I contest the one bill, the Pizza Hut cheque. I do not think that was my fault. I think that I was manipulated by collection agents who took advantage of the fact that I’m not a lawyer and I don’t know the law. I paid it because they threatened to nuke my credit and take the money from my paycheques. I was worried that if they were the arbiters of how and when I paid the bill, that if I did not take the responsibility to pay it on my terms (i.e. that day and in cash), that it would screw me over more. They might take an amount of money out of a paycheque that I was intending to spend on a certain bill, that would make it impossible for me to pay said bill, and thus cause me more problems. So I headed it off at the pass rather than let the amount grow (you know, it costs money for them to suck on my paycheques) - is that “irresponsible” or “the best thing I could do at the time, with my knowledge”? I was nineteen and had never been to court before, and small claims court here is very disconcerting, just you, two collection agents, a computer, and a cubicle, and lots of threatening. I was scared. I paid. My fault for paying? Absolutely. But I blame them for lying to me and for threatening me. If they’d been less manipulative I may have caught on and decided to talk to said bank’s “big cheese” (i.e. Lucifer) instead of paying. But when I am threatened with the “surgical removal” of funds from my paycheque, and the mysterious and cryptic "R-9"ing of my credit rating, I get a bit nervous and I do what I can to take care of the problem immediately.
Since then I have learned that if I am going to show up in court, I am going to research fully what the laws are and take as many free consultations with lawyers as possible. Is this irresponsible?
Well, had the deadbeat told me up front, “Hey, Caiata. I’m stealing the rent money so I can buy pot, so you’ll have to pay the rent again,” I might have been able to do something about it. Admittedly not much, as I was pretty broke by then. But I could have done something. Instead, he said, “Hey, Caiata. While you’re at work I’ll pay the rent today. Do you have the money on you?” And I, naively - yes, see, I admit that! - not realising how utterly vile and untrustworthy he was, gave him the money and said, “Thanks! Now I don’t have to take time off of work to do that.”
It is my fault that I trusted him. But am I to be held to blame because he said one thing and did another? Have you ever thought you knew someone, and then it turned out that they were different than you thought? Or are you psychic, and can tell by looking at someone, or can tell after two years of knowing someone who acts like x, that they are going to start acting like y instead? I’m not psychic. Mea culpa. Are you happy?
I filled out an application for the college, and an application for financial aid. The financial aid application came back as denied because they gave me a huge academic scholarship.
I have said time and time again that it was my fault - and I even said, my irresponsibility - that I did not understand that the money was a loan toward the rest of my tuition, rather than a nice way to provide me an on-campus job. The “I was not irresponsible” point that I was arguing with Libertarian was in respect to his assumption that I sat around after that year at Wash U and said, “Wheee! I really socked it to them, didn’t I! Hahahahah, I am invincible! You cannot make me pay you back, neener neener neener!”
I genuinely did not know I owed them anything. I was still taking courses and as far as I knew, I did not owe them a thing. It was my fault for not knowing, I’ve said that a thousand times. However, I mentioned in the OP about my family and their choice of where to send the bills because, during the 50+ phone calls I made to them between the time I left Missouri and the collection agency found me, if my grandparents had just once said, “Oh, Caiata, by the way, the school is sending you statements that you owe them money,” I would have been able to take care of the problem before the collections agency was involved, and it would have cost me less and more than likely stayed off my credit report.
I did not file a change of address form when I moved to Missouri from Indiana to go to school. I was not planning on getting my permanent mail in Missouri. I did not want to file a change of address form every time I went home to Indiana for a vacation. Rather I gave the businesses and people that needed to send me mail in Missouri my Missouri address, and businesses and people that didn’t need to send me mail anywhere in particular sent it to my registered home address in Indiana. When I transferred colleges I gave the school in Missouri - the only business who previously sent me mail in Missouri with which I would need prolonged contact - my new contact information, though they had it before (because I, strangely enough, applied to the college from Indiana and they corresponded with me there throughout my entire senior year). I told them expressly that I was moving back to Indiana and that <blah> would be my address there, the same address, I noted, that they sent my application to.
Not knowing that I had even taken out a loan, it was not possible for me to tell the loan people that I was moving. I did not know there were loan people. If I had known I would have told them. Plain and simple. Like I told the people who hit my car when I changed my address after I got evicted, even though I could have not told them and let them figure out how to track me down.
My main bitch with the whole student loan thing was that I could have paid it off so much sooner, had I known it existed. It was my fault - mea culpa, again - that I did not know it from the start. But I think it was not my fault that my grandparents, upon receiving “Final Notice - Legal Action Pending” envelopes in my name at their home, decided to chuck it in the trash because it couldn’t possibly be important because I’d already told my school where I was at, instead of telling me when I called (and I always asked about mail, I had a few catalogues that went there that I wanted here) that there’d been “no important mail, just junk”.
The moment I discovered I owed the money I paid it.
Let me ask you this: if a cop left a ticket on your windshield wipers, and a storm blew through and that ticket was swept off of your car by the rain and the winds, would you feel it was “your fault” you didn’t know about the ticket and thus didn’t pay it? Perhaps you should have known that parking there was illegal, but you parked there anyway, and yes, you deserved the ticket and you deserved to pay it because you had parked there. But you never got the ticket, so you weren’t expecting to pay a bill to the police station, and when the inflated “You have not paid this bill, we are now doubling it” statement finally got to you, you paid it.
Now, you are grumbling about the inanity of it all. Does that mean you are “whining” and “irresponsible”, or did you make an incorrect judgement call - in my case, not knowing about the work-study “loan” and thus not taking the work-study; in your case, parking in an illegal zone and not receiving your ticket - and are now fixing it in whatever way you can, but still perturbed that it happened in that particular manner?
Nice way to avoid the fact that you didn’t read much of what I wrote …
But I didn’t know they charged for stop-payments on stolen cheques until I had my cheques stolen. At that point, it’s kind of late to change banks to avoid the charges, no?
I’m not asking for sympathy about the car accident and my lack of car insurance. If I wanted sympathy I’d whine about the dog I grew up with as a child, but left behind when I moved out because it’s technically not my dog, that my parents want to put to sleep. That’s a sympathy-getter. Not paying one’s bills and then suffering from the repercussions of not paying them is hardly a potential sympathy-getter. You wouldn’t see it at the end of “Pay it Forward”.
I was explaining what had happened.
And I was - and still am - annoyed that though my car suffered one small ding, their car somehow managed to cost $2300. Their car was tougher than mine. If I wanted to have my car fixed (er, if I had wanted - I got rid of that car sooooooooooooo long ago! Thank all that is holy. Stupid Ford.) it would have cost me $10, and I could have done the labour myself; that’s why I am bitching. Crappy car - $10 damage. Tough car - $2300 damage. It just seems disproportionate to me. I am for damn certain that the dent they are claiming my car somehow carved into their door when they hit me was there before the accident. I think they lucked out. There’s no way I can prove it was there beforehand, though, so there was little point in contesting the lawsuit. I paid it, and now I’m grumbling. 'K?
Yes. Which is why I paid them all. When I discovered they existed. It’s hard to pay a bill I don’t know exists.
My car loan doesn’t send me payments in the mail. I am expected to send them a payment by the 9th of each month. I do this without a problem. In fact I sometimes pay 6 bills by the 9th of each month, just to get them out of the way and because I have the spare money. The difference between the car loan and the student loan? I know the car loan exists, and I realised when I signed whatever paper the car person put in front of me, that I had to pay it back. I did not know the student loan existed, there was no loan person telling me to sign things, there was just an ‘acceptance of an academic scholarship’ form, which I still contend mentioned nothing about the paying back of any loan. There was no bank paper to sign. There was no loan person to point me toward a loan statement to sign. If I signed for a loan I did so unknowingly, and this is my fault, mea culpa, yes.
I deserved to get stuck with all the bad credit that I got, except, IMHO, that Pizza Hut cheque. I have never said otherwise. I have given the extenuating circumstances because this is not a strictly black-and-white issue, there are shades of grey in at least -some- sense, and rather than just say, “Yeah, I don’t pay my bills but give me money damnit” I thought I ought to qualify, to “Yeah, I didn’t pay my bills, I had my reasons and at the time I didn’t think I had any other choices, but now that I’ve paid them all off and I’ve maintained the timely payment of every bill in the past three years, including but not limited to this lovely car loan you were so kind to give me, I think I might be entitled to a cheque card.”
Now I understand why I did not get the cheque card. The literature they gave me at the bank says, and I quote, “Works just like a check!” (See, I even spelled it like they did.) I do not consider a cheque to be a form of “credit”, so I did not consider a cheque card to be a form of credit. Now that I am aware of this - thanks to the helpful comments of Libertarian, Jodi, Bricker, and Doctor Jackson, and not at all thanks to your caustic sniping - I realise that I was in the wrong to assume that I should qualify for one. I realise that I have some work to do on my credit before I can get one.
I am still pouty. But like every other credit rating issue that I’ve had in the past, I will suck it up, do what I need to do to take care of it, and get on with my life and the repair of my credit.
I still reserve the right to pout. If you do not like it, tough on you. 
That was very cute.
However I’m an incredibly fun-loving person, and hanging out with me, when I haven’t recently been on the phone with a woman telling me I suck too much to have what I want, is actually a quite fun experience. Or so I’m told. As always, YMMV.
More advice to do with as you will: anytime you do this — entrusting someone else with your financial commitments — never forget to say, “And bring me the receipt.” And always follow up by calling the creditor and asking if, in fact, the debt was paid.
Now see, that was all constructive and stuff. I don’t know if that’s allowed in the Pit, is it?
Thank you Lib. That’s a piece of advice that not only I can take, but that I can understand, and that wasn’t delivered with anything resembling spite. I can deal with that. I can take that. I don’t get pissy about that.
Sure, it’s common sense, but as you can tell I didn’t have a whole lot of it back in 1998
k.os I have read numerous times that Canada has the highest penetration rate for use of debit cards (followed, if I remember correctly, by Australia) – our banking system makes it easier, all CDN banks are chartered federally, whereas the US banking system is more fragmented making it more difficult to set up a universal debit card system.
Caiata, the crux of your misunderstanding comes from the vision you have that a Visa check card purchase always clears instantly at the bank. It does not.
The vast majority of time, it does. However, if the verification system is down, merchants - even those using the swipe machines - are permitted to accept certain purchases without requiring verification. So the machine, even though it prints out a receipt for you to sign, is merely storing the transaction for later transmission to the bank.
Another example is the tip portion of a restaurant’s charge. When you pay with a credit card, or a Visa check card, the restaurant runs your bill total, and leaves you to add the tip. In some cases, they merely verify your card is good (not on a stolen list) and print out a receipt for the total without checking funds. At the end of the night, the bill, plus any tip you’ve added, are entered into the credit processing machine and transmitted to the bank.
Finally, flea markets, craft shows, and vendors in temporary locations are permitted to use the old-faashioned “hand cranked” card imprint, rather than call a card in for authorization, as long as the purchase is below a certain threshhold. In fact, I remember wandering around a craft show with a then-girlfriend, who was buying things left and right with her credit card… all less than $75. She told me at day’s end that her card was over the credit limit already, and wouldn’t have been authorized, but for under $75, they didn’t have to call it in and check.
Needless to say, that relationship did not last. But in that case, the loss was borne by the bank, not the merchants.
I hope that’s clear now - if not, I’ll be happy to address the individual hypotheticals you posted…
- Rick
I hate that hand-cranked thing. I just needed to say that. When our power went out at the pizza place I used to work at (which was about every time a cloud passed over our building) we had to use it. It was hell. Ugh. I hate that thing. Hate it hate it hate it!
Okie! Moving on.
Point taken about the outdoor activities, Amish fairs, etc. I hadn’t thought of that. (I wonder, idly, how the Amish deal with credit cards …) But really the main point of the Noble-Prize-winning Vision was the “… make it happen instantaneously” deal. If you are in a restaurant, don’t swipe the card until the tip has been added in. (I never understood why people did it that way, anyway, as if it’s so horrible that the waitress might see the tip you’re giving her up front. Do they think she’s going to change it? She could do that on the electronic machine thing - I changed someone’s tip by accident once when I hit a wrong key, and I never would have noticed if I hadn’t been the one balancing out the system at the end of the day.) If the system is out, call it in. If you’re in an outdoor location, call it in. It just seems like it’d be so simple! If we made it happen instantaneously, wouldn’t it be wonderful?
I am interested, though, in knowing why the banks aren’t so concerned about my ATM card and me coming in, in person, to take the money out, before the said $200 cheque goes through. nods But if it’s too much trouble, don’t worry 'bout it
Dirty Little Secret Time: Although it probably isn’t an “official” policy of the banks, in writing, my experience is that if several items come in on the same day, they will begin posting and clearing them in descending order of value, from the highest dollar amount to the lowest. That way, if your balance is low, they can hit you with several overdraft fees rather than one.
So, Caita, in your scenario, if you have $50 in your account, and your $20 and $200 transactions come in at the same time, they will bounce the $200 check, hit you with the overdraft fee, then try and clear the $20 transaction. If, after being hit with the fee for the previous transaction, that one bounces as well, they can hit you again.
Anyhoo, I can’t offer better advice than other have, but hang in there. It does get better.
Lib:
What world do you live in?
So 2 19-year-old roommates want to get some groceries and one says, “I’ll go get them. Gimme half the money.”
Roomate 2 says “OK. Here’s a twenty. Get a receipt. I’ll be calling the store to see if you paid it or put on our account.” They’re 19! They’re roommates not bankers!
They live together, and consequently are in positions of trust. Are you going to lock up all your possessions every time you go out?
What a righteous, parental and idiotic response!
Caiata, I don’t really have much to add to the conversation except to take the comments from Lib with a grain of salt. I don’t know him personally, but my experience is that there have been several times when he tends to take the antagonistic point-of-view. Nothing personal against him, however.
Geez Louise, who pissed in Monty’s Cheerios? Come on, fess up, you know who you are!
Caiata - Definitely look into the credit union if you can qualify. IME, they are much more customer-oriented and usually have lower and less fees. OTOH, they often have stricter lending/credit practices than banks, so you may still have trouble at first getting a debit-card. But if you can get an ATM card and have checks, how often do you have to go to the bank in person? (That’s why I had an ATM card as soon as they came out - the nearest branch was 25 miles away. Between that card, the mail, and my checkbook, I rarely had to make the trip.)
And if you want a debit-card that much, talk to the other banks, have them look at your records (both credit report and bank account history), and ask if they will give you a card or what the waiting period and terms would be to get one. Get their answer in writing. Then switch banks. Just don’t get so excited over that one item that you screw yourself on fees and such, mkay?
CAIATA –
AFAIK, the difference in your hypotheticals is merely the ease with which you can overdraw your account – and badly – with a check card, coupled with the fact that many banks do not have the option of charging NSF fees for check-card transactions because there is no “check” to “return.” It is obviously possible to overdraw an account much worse using paper checks, but it’s harder to do without an awareness that overdrawing it is in fact exactly what you are doing.
All I can say is that from talking to a friend in banking I was given to understand that banks can be picky about who they give check cards to because in their (the banks’) experience check cards are more easily and more often abused than paper checks, and the banks have less recourse in the event they are.
nods Gotcha Jodi. Maybe part of my Nobel-Prize-winning Vision should be to allow the bank to do something about cheque-card abuse akin to the fees they can charge for cheque abuse. But I still think if we just made it all instantaneous (again, hypothetical!) there would be no room for cheque card abuse. nodsnods!
And redtail23, I didn’t get my ATM card until Tuesday … my original ATM card was stolen in Feb of 1998, when my purse was stolen, and it took said-evil-bank three and a half years before they would issue me a new one. In fact, they never cancelled the original, even when I reported it stolen! So I could have been way more screwed than I was, if the guy who stole my purse had figured out how to use it. I was at least smart enough not to keep my PIN number in writing in my purse Finally they decided on Tuesday - after I ranted at three different people - that it was “safe” to issue me a new ATM card. Buh. (After my purse was stolen they gave me some BS excuse about having to wait 90 days after the incident was reported … then it was something about mailing it to me, and that never happened, and after several arguments with them in person I just decided an ATM card wasn’t really worth it, but now that I’m going overseas I think I ought to have one. nods)
JeeZUS. My bank may be assholes, but they ISSUE ME A FREAKING ATM CARD ON REQUEST if I so much as LOSE it, with no greater disruption in my life than my having to go across town to my home branch. Yikes. I would change banks toot sweet.