Thursday, June 3, 2010

Time to Find a New Bank

"I warn you, Sir! The discourtesy of this...Image via Wikipedia
If you stop by here and actually read some of my commentaries and rants, then you probably have already ascertained that generally speaking I am a pro business kind of guy.  I am all for a company making as much money as they can, so long as it is done in a lawful and, dare I say it, ethical manner.  You also have probably figured out that I am not generally a fan of more government regulation. 

Having said all that, I would like to relate an incident that occurred with my bank yesterday and today in regards to some fees we were charged.  Even after spending an hour on the phone with two different people, I am still left scratching my head at their logic.  After my experiences today, I can understand why the Democrats want to pass legislation to protect consumers from unfair bank fees.  The situation for me today that has provoked my wrath concerns overdraft fees.

For the sake of simplicity, I will use some simple numbers to illustrate my case.  Let us say that my wife and I had $100 available yesterday in our checking account.  My wife went out and made three purchases with our check card, each for $30 dollars.  When those purchases were made, they put a hold on the account for the amounts of those purchases, even though the money was still technically in the account.  I have no problem with them doing that and fully understand the concept of "available balance."

Getting back to my simple example of having a $100 in the account and my wife making purchases totaling $90.  Simple math tells me that we should now have an available balance of $10.  Unfortunately, there was a $12 gasoline purchase that we had failed to account for.  Subtracting that $12 from the $10 put us in an overdraft situation of $2.  Mea culpa, mea culpa.  Totally our fault and we deserve to be charged an overdraft fee.  Our bank charges a $29 overdraft fee.

But the story does not end there.  Had the bank charged us the $29 overdraft fee, I would not have been happy, but I would have fully understood.  As is often the case, the story does not end there.  Even though my bank had already put a hold on the $90 in purchases, the $12 gasoline charge was presented for payment before the charges.  Even though there was $100 in the account, the $12 was taken from the "available balance" of $10 resulting in the overdraft.

Each of the three purchases were then "presented for payment."  According to the bank, even though they had already put a hold on the $90, we now had a negative available balance on the account. Consequently, each of those three purchases were subject to the the overdraft charge.  So, in the end, for a $2 overdraft, I was charged a total of $116.  To use a word that the Democrats like to use, is it "fair" to charge $116 for a $2 overdraft because of the bank's funny math?  Again, I understand being charged one overdraft fee, but four? 
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  1. I agree. But in the free market world, you switch to another bank, right? But they all pretty much suck - except for credit unions.

    I have the opposite problem with my Comcast cable. They stopped charging me for the Internet service, and I'm having trouble getting them to charge me. Is it crazy of me to open up my mouth about the discount? I'm afraid one day the Internet service will be turned off, we'll lose our e-mail accounts and it will be a hassle to get things turned back on.

  2. actually, it is a credit union where it happened.

    I have always hated Comcast. Instead of turning things off, they may end up giving you a huge bill for back payments.



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