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Sep 16, 2008 -- Remove overdraft authorization from your bank account
Many banks have software systems designed to throw you into overdraft so they can score big on fees. Here's how it works: Let's say you have a debit card. You use it and your transaction is approved even if you don't actually have the money in your account. That's when you'll get hit with an overdraft fee -- even though the transaction goes through!
PIRG now reports that half of all overdraft fees come from debit cards in this way. But there is a solution. You can tell your bank to remove the overdraw authorization on your account. Clark recommends you go in person and fill out the necessary paperwork.
Yes, you'll have the embarrassment of having your card rejected at the coffee shop if you don't have money in your account. But it is better that you should have to dig through your pockets for cash than pay a hefty fee later and get the transaction approved up-front.
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What others are saying
BOA Criminal Overdraft Fees
Bank of America has got to be the worst offender in this matter. BOA LOVEs to rack up criminal overdraft fees on your account. They will pay small drafts on your account as low as $2 or less which is not much of a risk for them but brings in hefty $35 overdraft fees. Then to add insult to injury they won't bother to decline your checkcard or debit card but will notify you days later by mail and allow other small overdrafts to continue to post. That is an unfair business practice and criminal in my opinion and apparently to Congress too
Wachovia policies
I had a check clear but because I had a hold for another item they charged me a $35 overdraft fee and then another one when the hold was released the next day.
my bank wont do that. I've asked them several times and they dont do it. They're just a bunch of money hungry bastards
rigged order
if you look at how your transactions come out of your account you'll notice that boa starts with the highest transaction first and then goes down. so say you have $50. and you spend $1 then $5 then $10 THEN $41 they'll take the $41 out first to insure that you get 3 overdrafts instead of the 1 you should have gotten from spending the $41 last. this is an EXTREMELY crooked practice.
BoA overdraft fees
Oh yes, my teen age son just learned about the evil of BoA. His almost new account he made a payment on his phone bill with his debit card (instead of the cash in his hand) put the cash into his account that same night. It resulted in $140 in overdraft fees (4x$35) so far at the time we received the first notice. A cheap lesson for him but BoA. Of course, thats on top of other nusaince fees of $2 x2 for ATMs not in their system. Gee, now he's $143 overdrawn - their fees.
Now I guess I will introduce him to my local bank where my whole family has migrated over the years.
BOA Double Charges
I made the mistake of opening a BOA account even though I belong to a credit union. I made a miscalculation o my balance, thanks to Sam's club taking 3 days to process a debit card purchase. The overdraft was on 6/25 on a 6/22 purchase. On 6/29 an overdraft notice was send out via snail mail. I received that on 6/6. Today was my first opportunity to go in clear up the balance. As I was heading to the bank I heard Clark talk about all the policies and procedures that BOA has in place to charge customers; so I decided to close the account as well. When I got there I found out that because I didn't pay the overdraft with in 5 business days an additional fees would be charged. BOA wait 2 days to mail the notice; and USPS take a week to delivery a "First Class" piece of mail.
The Customer No Service at BOA said that I should have been checking my account on a daily basis. When I pressed them on the lack of logic in even sending a mailed notice when they charge the additional fee before it can get the the customer, they could not even begin to get that it was so illogical.
But lesson learned Credit Union from now on.
Responses from Credit Union Land
Full disclosure- I work for a community-chartered credit union, and I have spent time in the Electronic Services, Call Center, and lobby environments.
At my credit union, we don't look at a chronic overdrafter with dollar signs in our eyes. We'd much rather help you overcome your dependence on overdraft services, put the money you save on fees towards your retirement, and have you tell 5-6 of your friends how we helped you out. That's far better business practice than collecting thousands of dollars of fee income per year and watching you drive yourself into the ground. If your bank or credit union is celebrating the fact that you just paid $50 for a candy bar with your debit card, you should take a hard look at who you're doing business with. But you should also look in a mirror and wonder why you bought that candy bar when you didn't have enough money in your account!
Regarding the comments about available vs. ledger balance, authorization holds are part of the card purchase clearing process- and a part that credit union employees hate as much as you do. Do you suppose that the supermarket would let you leave with your groceries before you paid? Right when you swipe your card to pay for something, DEDUCT it from your balance, since you've already spent the money. You should never count on "debit card float" to give you an extra two days to make a deposit to cover purchases that you've already made. It's your money, so whose job is it to know how much is in your account?
overdraft fees to credit card
Bank of America charged my credit card 100.00x2 for a small shortage money in my account, can they do this?
overdraft
Regions does this to us also .they lump several withdrawals together and bounce all instead of one.they also charge extra fees when there is no apparent overdraft saying that it is justified because the money is held as soon as the card is used. they also switch books to get additional fees going between "available" and actual balances. we need to contact our attorney general offices and maybe one of them will have enough guts to sue these thieves.
overdraft
can i dispute over draft fees
Grrr
I wish I knew. It is so ridiculous that they can get away with this. If we steal, we get arrested. How dare them steal the little guys money to help bail them out of trouble they got themselves in to begin with!
I guess I'll try not to think about it. Is there anything we can do?...
Gulf Winds Credit Union
Changing banks won't stop the manipulation. Four years ago we left Regions Bank for this CU thinking the insanity would stop. It did for a while but soon,the charges started again. Somewhere along the line they both(CU & Regions) started doing debits before deposits and credits. They both also tostarted lumping all the transactions together instead of taking out the debits one by one. They have reversed cleared transactions after several days include one that will put us into OD because they haven't put the new deposit in yet. Then they bounce everything that had previously cleared. I just removed the ODP but need a way to prosecute & stop this practice. I just found this on line: H.R. 627, THE CREDIT CARDHOLDERS’ BILL OF RIGHTS ACT OF 2009;
AND H.R. 1456, THE CONSUMER OVERDRAFT PROTECTION FAIR PRACTICES ACT OF 2009”
BEFORE THE SUBCOMMITTEE ON FINANCIAL INSTITUTIONS AND CONSUMER CREDIT COMMITTEE ON FINANCIAL SERVICES U.S. HOUSE OF REPRESENTATIVES MARCH 19, 2009 Overdraft Protection Bill. The Consumer Overdraft Protection Fair Practices Act would extend the protections of TILA to overdraft protection programs and services provided by financial institutions.3 Specifically, the overdraft bill would require consumers to opt- in to overdraft protection programs, would require financial institutions to provide enhanced disclosures, and would prohibit financial institutions from manipulating the posting of checks and other debits to generate overdraft fees. Where do we go from here?????
Washington Mutual
WaMu is also very dishonest. Every morning they do their debits before their credits to suck as much money out of you as possible. One evening after spending and crediting our account over the phone we had a $90.00 balance but three overdraft charges. We had a balance!!! We called and they would not remove the fees so we are chaning banks.
Big banks
Wachovia is insane. They will manipulate the way you spend your money in any way to increase their profits in overdraft fees. You could go over ONE CENT and they could still be able to STEAL over a hundred dollars from you in overdraft fees. I could explain, IF it made sense when they told me. They make it seem like it makes sense but it is not logical. I would hate even being that person having to explain why you are being screwed. I believe they have had to explain it so much that it just second nature to them and they spit it out like an automated machine that you can't ask questions to.
They will use any way to maximize their profits. One thing they did to me that I have noticed happened to a lot of people is that they will take out the larger purchases first(to deem the account OD'd) before the smaller ones just so they can charge you x amount of times for OD charges even if you made the larger purchase after the small purchases.
Also, it is almost like they will hold off on taking certain purchases out of your account until "the red flag" goes up telling them that your account is low. One example is that they just took out a purchase on my account that was made 5 MONTHS ago on a debit card which incidentally made me OD. I contacted the company about it and they said that they had already taken the money a few days after the purchase. The bank says they must be lying. Hmmm, I wonder whats going on here.
One more thing is this has only happened to me twice now(Because I keep my own records now) but what I have noticed is that every time this has happened, they process EVERYTHING at once. This includes all the OD charges, older purchases along with the fact that it is right before my pay day. It's almost like they knew that their OD charges were going to be paid for so they didn't even show me my account was even overdrawn until they racked up a decent amount of OD fees.(keep in mind that i only went over 49 cents)This was the bigger purchase, meanwhile the smaller ones were "processing". I ended paying $140 in OD fees for going over 49 cents!
I'm not saying that it is a conspiracy but one thing I have learned is that you better keep a strict log of all your purchases or perhaps take out just cash because they will screw you if you let them. Also, their online banking is a joke. NEVER depend on that.
Anyway, just getting some steam off.
gas stations
Gas stations - NEVER SLIDE your debit/check card anywhere until *after* you have pumped your gas and there is a specific amount to charge. Most of the times this means you will have to go inside to the clerk, since no gas station will let you pay at the pump *after* pumping. Many stations this means you will be unable to fill up, you will have to go inside and pay for a specific amount first and then thats all you get. I just avoid using stations that do this.
8/10/07 debit card transaction changes
I noticed five overdraft fees on my bank statement with Bank of America. But, after reviewing my statement my account never went into a negative. I do not have a link to my savings to pull for overdrafts. June 2007 statement from Bank of America - "Effective 8/10/07, when we approve a request from a merchant to authorize a debit card transaction from you account, we may reduce the available balance in your account by the amount requested by the merchant. Your remaining balance must be sufficient to cover checks, debits, and other items that post to your account, or you may incur overdraft or returned item fees. This amends your debit card agreement with us." Can someone explain how this is legal?????
RBC Overdraft Protection
I was told that I had a $300 courtesy overdraft limit on my checking account. After spending 2 hours at the RBC branch, I was told that it was removed. A few weeks later, I was hit with over $100 in overdraft fees ... they never removed it. Went to another branch to do the same and they told me it shouldn't go through if I use it as as a debit but if I use it as a Visa that they have no control. I went through the process again and also showed them on my account that it was a debit. Well, they did it again! There were 3 debit approvals that went through when the account was overdrawn ...$43.00 in gas cost an extra $123!! I do not have this problem with any other bank I deal with in terms of a debit purchase. Stay away from RBC ..,. they keep saying it's been removed, but it hasn't! I am taking it to the top this time. And they do the same, clear larger debits before smaller ones to collect more fees.
Removing Overdraft Protection
Write a letter telling them that you want ovedraft protection removed from your account. If they say you cannot remove it, get a new bank and take your letter declining overdraft protection with you when you open the account, making it clear to your new bank from the start.
Beware tho. Rather than decline a transaction that exceeded my available balance, my bank used a pending deposit to pay an item. When asked why they permitted authorizations in excess of my available balance, they said "Your debit card was allowed to go through because the check was still in clearing. If your account didn't have that check in clearing, the purchases wouldn't have been allowed through. We work under the assumption that the check will clear, so if you choose to use your funds before they are available, we will allow them but you will be charged a fee. " I turned off overdraft protection, and I don't rememeber the part where I said they could use my own money to violate me.
I have asked them repeatedly to send me a copy of the terms of service that explains in plain English exactly what happens, but they simply don't have a document to explain it. This Bank is MB Financial.
Wells FArgo
For whatever its worth : For every Checking account i have i create a SAvings Account.. Wells Fargo lets me hook One Checking up to One savings account for overdraft protection. I also have my wellsfargo Credit card protecting one of my checking accounts. There IS a $10 when you "overdraft" and funds get pulled.. but its a tad better than the $30-40 or so.
Bank of America posting process rigged
Is there a bank out there that has not rigged the posting process to accumulate debits before it applies your deposits in order to generate fees? This should not be legal.
Wachovia is disgraceful
I was just charged $210 in overdraft fees and for the life of me I can't see how it was justified. I have spent 45+ mins HOLDING on the phone with them trying to get a person on the phone that can explain to me how this has happened. I had a posted balance of $57 and then $54 dollars in pending transactions. How does that overdraw? Is there nothing we can do about this problem??? How can banks get away with doing this?
overdraft charges
My brother came from India,and open an account with wachovia, Me,my housband had with wachovia since 20yrs, never new about this charges till recently, my brother use debit card thinking ,only transiction will go through if there is money?, he must have use may be 50 dollars worth, but overdraft charges! over 300 dlr, and he makes 6dlr per hr. And asking and calling wachovia, no one is explaining any other alternative, because they do not want to loose your overdraft income! is this criminal act on bank side? can we file action law suit?
thank you
I needed to know this! Sometimes I run close, and am eaten up by debit-card overdraft fees...
Bad advice, will cause Bounced Checks.
If you remove overdraft protetion from your checking account then your checks will bounce if you over draw your account. Bouncing a check is a criminal offense. Better to pay the overdraft fee.
Overdraw Authorization
Bank of America refused to withdraw the overdraft feature from my account. Compass Bank refused to do it for my son. Is there a law these banks are breaking by refusing our requests?
overdraft removal
Clark my son is 19 and has a checking account at Wells Fargo and we went in today to remove the banks overdraft limit where it charges him $36 dollars a pop if he goes over. The manager stated there is no such letter and that there is NO way to remove it...? Help Confused from California
Courtesy Pay Overdraft Protection
I don't believe that any financial institution can require that you have overdraft protection. I work for a Credit Union. We have a form for members wishing to opt out from this type of protection. Also I worked at Bank of America recently and don't believe the associate that you are dealing with if providing accurate information. I would stop by a banking center and ask to speak with a manager.
Overdraft
Why does Wachovia say there is no option for this or paper work to fill out. WHY WHY
Overdraft protection
I have repeatedly asked my bank, Bank of America, to have courtesy overdraft removed. I would love to have my card rejected if I have made a budget error. The bank says that I am unable to opt out of overdraft protection. Does anyone know for certain that I can do this with Bank of America?
overdraft protection
I bank with Wachovia and I simply have a separate line of credit that is activated should I overdraft and the money comes from that account. If I pay it off within 30 days, I don't pay interest on the advance and I avoid a huge $35 overdraft fee!
This Week's Poll comment
None of those are even of concern Clark. The real point is that we have political leaders in Congress using Social Security funds to pay other things and also pork barrel projects that our fantastic leaders don't need except to have themselves re-elected. So the REAL issue is where are the leaders of our government taking money from--which program--to subsidize their own greedy needs.
Overdraft fees
Another way I find that the account is overdrafted is by using my debit card at a gas station, or other, which does not require putting in the securinty code to get the product. I have learned that if the security code is not requested by the machine, one will get tacked onto the cost of the product a security fee, (hefty in some cases) which has over drafted my account. It takes a couple of days for the security fee to be released back into my account. I have noticed this more and more as the economy has took a dive and for the first time in years, I am seeing overdrafts on my account. I have learned that one must go into the gas station and tell them exactly how much you want on the card and this will protect from the holding fee. Also, I use my debit card less as I have lost trust in how companies are meeting there bottom line and also I do not like for others to be using my money for more than one minute to profit in some way. Maybe the fee comes from loss as a result of idenity theft (cards) in my case..
Overdraft protection
US Bank will happily scam you on this overdraft thing. They are crooks!
