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| Overdraft fees
Posted: 9/27/2009 7:42:39 AM |
I already said that many banks and bank options are NOT AVAILABLE to certain people, and usually these certain people are the poor.
I'm poor, yet I have a debit card. I've never had an overdraft. When I'm running low on money, I stop using my debit card until I've refilled my account with some cash. I do agree bank fees are outrageous, but a debit card is not something a person needs in order to stay alive. Nobody, not the poor, nor anyone else, needs government protection from the bank's overdraft fee. They can, and should, be protecting themselves from those fees by not spending more money than they have. An overdraft fee is an easy penalty to avoid. | |
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| Overdraft fees
Posted: 9/27/2009 10:13:17 AM | Not so.
My foreign lady friend got one of those cards where you put up money for the card, so the card is guaranteed. It was $500. Just to establish credit.
She used the card one time for $20.
Over the course of five months or so, the bank took ALL of her money.
I counted seven different charges to her account; there were overlimit fees, late fees, two kinds of insurance, and some stuff I can't recall. It was INSANE.
And the $35 "overlimit" fees were the trickiest of all. It worked like this....the statement has a dollar amount at the top, the minimum that you need to pay(supposedly) so that's what my foreign friend paid. Mind you, she'd only spent 20 bucks out of 500 OF HER OWN MONEY. Okay....if you pay that minimum amount, that apparently wasn't enough to counteract the overlimit fee. It was simply CRAZY. It's been a few years so forgive me if I'm not explaining it that well. The bottom line is that it was sheer thievery.
So....I filed a small claim for the amount. My lady friend did not have a good command of the language at the time, so I knew that I had a good case.
Sure enough, the high powered attorney settled with me in the hallway that day, because she didn't want the story aired in the courtroom.
This was one of the major banks. Crooks.
The **stards had been calling my friend all the time, asking if she wanted the stupid "insurance" and she always declined it, and yet there were two kinds of crazy insurance charges on the card that helped to wipe out her startup money.
Yeah, seven different crazy charges. I remember that clearly. And it was her own money for the damn card!
I think that if most of the bankers wind up in bottom of the river, they won't be missed. | |
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| Overdraft fees
Posted: 9/27/2009 2:40:41 PM |
Not so.
My foreign lady friend got one of those cards where you put up money for the card, so the card is guaranteed. It was $500. Just to establish credit.
Sounds like she had a secured credit card, not a debit card. There's a difference. I'd only use a debit card and never a credit card, myself, because I don't want to pay interest. About the only thing I'd take a lone out for is a house--but I'm to poor to think about that anytime soon.
I've heard stories from all my friends about the banks jump up interest rates on credit cards, even on amounts borrowed at previous rates. I'm not sure if that's true--my pals say it is. If it's true, I'm not sure how the banks can get away with it. Seems to me, they already had a contract with the bank at the lower rate, when they borrowed the dough to by that widget or what ever it was they had to have right at the moment instead of waiting until they had the cash, then buying it. Anyway, in this case, if true, seem some regulation is required. | |
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| Overdraft fees
Posted: 9/27/2009 3:19:31 PM |
already said that many banks and bank options are NOT AVAILABLE to certain people, and usually these certain people are the poor. The reasons that people cannot shop around are many, but here are a few:
1) Location. From personal experience, I had to find a new bank when I went away for college because the one that I had used since I was 5 did not have a branch within 40 miles. This is, again, especially true of the poor because they are less mobile (cost of driving and/or lacking personal transportation altogether).
2) Institutional restrictions. Many banks require that you have a certain amount of money in your account, thereby making these types of accounts unavailable to those that are living paycheck to paycheck. Also, many credit unions (although most are becoming more 'open') have restrictions on who can become a member based on employment or other affiliation.
3) Lack of education. Not just in terms of finance, but simply in terms of being able to read or understand the contract.
Sorry, but I have to wholeheartedly disagree with you on this.
While location MIGHT be a mild deterrent to an account in some banks by some folks, the amount of money required in a demand draft (checking) account is usually nominal, if any at all. And lack of education? Contract? What contract? Do you mean the terms of use of the checking account?
Those aren't reasons many people "can't" get accounts at many banks. The MAIN reason people are declined for accounts at banks is because they have screwed up their accounts at other banks in the past and are now listed in reporting systems such as Chex Systems.
When they go to apply at their next victim bank, they're run and declined because they've shown they are not responsible enough to handle an account, or skipping on a negative balance at another bank they've overdrawn.
THAT is the main reason many banks are not available to many people. Let's be honest about that. Just from reading postings here - people not knowing what their balances are...I guess they aren't capable of using a Debit Register, which is much like a check register for recording and keeping your balance KNOWN TO YOU.
If you are unable to maintain and simple single-entry bookkeeping system like a debit register, then you probably should not have a debit card because you will only get into trouble with it. Your best choice then is to just use cash. Simple - If you don't have any in your pocket, then you don't buy something. | |
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wudger
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Joined: 12/20/2007
Msg: 28 | |
| Overdraft fees
Posted: 9/29/2009 12:48:22 PM | damn that socialist obama.
Bloomberg.com today
Federal Reserve Proposes Rules to Implement Card Law (Update2)
By Jeff Plungis
Sept. 29 (Bloomberg) -- The U.S. Federal Reserve proposed rules today that will end banks’ ability to apply credit-card payments to balances with the lowest interest rates first, implementing legislation Congress passed in May.
The Fed also proposed that creditors obtain consumers’ consent before charging fees for transactions that exceed credit limits. Restrictions on lending to people under the age of 21 and subprime credit-card fees were also included, the Fed said in a statement.
“The rule bans several harmful practices and requires greater transparency in the disclosure of the terms and conditions of credit-card accounts,” Federal Reserve Governor Elizabeth Duke said in the statement.
President Barack Obama signed the credit-card legislation in May, describing its provisions as “common-sense reforms” that would “protect consumers.”
The Fed’s proposal generally prohibits rate increases on fixed-rate accounts in the first year after an account is opened, as well as increases on existing credit-card balances. For consumers under the age of 21, cards can’t be issued unless the borrower can show an ability to repay the debt or an older person agrees to back the account.
Fees on so-called subprime credit-cards, those issued to consumers with lower credit scores, will be capped at 25 percent of the account’s credit limit during the first year after the account is opened, according to a description of the rules in the Federal Register.
Three Stages
The law is being implemented in three stages. Today’s rules will take effect Feb. 22. The first parts of the law, giving consumers the right to reject rate increases within 45 days and pay off balances at the current rate, took effect Aug. 20. Companies also began mailing bills 21 days before the due date, up from 14 previously. Remaining provisions are scheduled to go into effect Aug. 22, 2010.
House Financial Services Committee Chairman Barney Frank, a Massachusetts Democrat, and Representative Carolyn Maloney, a New York Democrat, proposed Sept. 24 to move up the implementation date of the card law to Dec. 1, saying lenders have been using the implementation period to add fees and raise interest rates.
Average write-offs for U.S. card issuers, including JPMorgan Chase & Co., Bank of America Corp. and Citigroup Inc., soared to a record 11.49 percent last month, according to a Sept. 23 report by Moody’s Investors Service. PNC Financial Services Group Inc. said yesterday defaults eased in August.
American Bankers Association Vice President and Senior Counsel Nessa Feddis said today’s announcement is mostly the technical language needed to implement the May law and reconcile it with previously announced Fed rules.
“Our hope and expectation is that the law will be implemented in a manageable way,” Feddis said in an interview. | |
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