Chase's overdraft fee scam ( now resolved but interesting discussion )

turbodog

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Re: Chase's overdraft fee scam

Once upon a time, it was considered immoral and wrong to take advantage of a person's ignorance in a specialized field like loans and credit. There were Usury laws that at least gave a person a chance to keep from being shafted if a bank got greedy. Banks were not allowed to make loans that they knew would fail. They were not allowed to charge huge fees.

A while back (i believe it was during Regan's administration) those laws were weakened, and are now virtually gone.

It's still not right to take advantage of people, and a suggestion to "man up" sounds like it's in support of the right to rip off people. That just does not sound right on CPF.

Daniel

With the way the world is getting more complex, while people have a finite attention span and ability, everything is turning into a specialty.

That said... banking's not much different than any service business.

In short... be as zealous in protecting yourself as others are in trying to screw you.
 

turbodog

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Re: Chase's overdraft fee scam

I'm not disagreeing that they won't try. We see what already happened when the credit laws were changed. The banks basically said since we won't be able to make as much money in the future we'll have to make up for it now, and then put through all kinds of interest rate increases prior to when the laws took effect.

However, what they made on credit pales next to what they made on overdraft fees. I think it was close to $40 billion for 2009. I don't see how they can make up for that with other fees. There's only so much you can charge for checking or a CC before the customer will jump ship. Then again, maybe they don't have to collect as much in fees if they reduce their expenses. By just not allowing people to spend more in their accounts with their debit cards, they're lowering their exposure to risk, and their expenses, quite a bit. I'll hazard a guess that the banks will make just as much in 2010 despite the changes in overdraft laws without relying much on other fees. That same 14% or whatever that paid most of the overdraft fees likely cost the banks nearly as much in defaults. How many probably just walked away from their accounts once they became negative by four figures? Sure, the bank can try to collect, but for the most part they're dealing with people who have low, sporadic income, sometimes off the books. Lots of luck getting anything. In fact, lots of luck even finding a lot of these people given how often many on the low end of the income scale move.

That's only $133 per person in the US.
 

turbodog

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Re: Chase's overdraft fee scam

I just want to thank the the staff for allowing us this leeway and those who have been conducting a sensitive and impassioned debate with respect.
I don't mean to sound harsh in my posts but truth be told I am harsh, but I want to say that I respect all who have taken part even if we don't see eye to eye. :thumbsup:

Surprising it went this far w/o a fistfight breaking out.

Agreed.
 

bstrickler

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Re: Chase's overdraft fee scam

The way things work now if you go one cent into default it could easily trigger hundreds of dollars in charges.

I can testify to that. I just had a similar situation to that happen.

I bought something online about 2 weeks ago, and ended up going $5 over what I had, and got charged a $25 overdraft fee... Want to know whats really jacked up?? I have over $50 in my savings account with that bank, for that reason! Why the hell didn't they just pull the $5 from my savings account, then tell me that that happened? That's royally screwed up.


I went into the bank today, and asked why that happened... Their excuse? That $50 is an investment in the bank, and you cannot use it, unless you close your savings account, which closes your whole account with us...

WHAT THE HELL?!! I can't use my own money!? I was never informed of this when I got an account with them!

Reminds me of that JG wentworth commercial (not that I'd ever use them, unless I had no choice)... Its MY money, so I should be able to use it when I NEED it!

I wouldn't care if they charged a $5-$10 fee for my own stupidity, and having to draw money from my savings account. I just don't get this whole thing about requiring me to have $50 invested in them that I can't even use, in situations like that.

At least there's 1 nice thing about the way they're set up... Once you overdraft, you can't use your debit card anymore, until you pay off the charges, and bring your balance back to the positives.

I'm going to steer away from using my bank account, and just use one of those pre-paid debit cards, instead, and reload the card whenever I need to use it. Keeps me from screwing up

~Brian
 

Beamhead

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What bank, did they reverse it, they should link your savings to your checking with overdraft protection included for free as long as the savings has enough.
If not then use another bank.
 

bstrickler

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What bank, did they reverse it, they should link your savings to your checking with overdraft protection included for free as long as the savings has enough.
If not then use another bank.


Hughes, and no, they didn't reverse it. I'll pay it off when I sell my P60L, and some other things, on CPFMP. Thankfully, there's no interest fee's with that, so I can take care of that when I get the money.

This probably wasn't the best idea, but I ended up opening an account with Chase after I went to Hughes (before I even came upon this thread), because I hate that your savings account cant be tapped into if its at the $50 mark (I forgot to mention that if its over $50, they'll use your savings account, sorry), and that you can't use any ATM you want (there's only a few of their ATM's around here that I know of), while Chase allows you to use any ATM you want (I know they charge a fee for non-Chase ATM's, but that doesn't bother me. I only use ATM's when they place I'm at doesn't accept debit cards, or checks, which I'm surprised still exist).

I'm probably complaining about something that I shouldn't, but I just needed to rant some (hasn't been my year so far)

~Brian
 

gadget_lover

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Re: Chase's overdraft fee scam

So these poor ignorant fools are not responsible for their actions?
That is the exact reason some not all but some banks are being squeezed, you have a guvment bent on class warfare demanding ninja mortgages be issued

I've heard this asserted many times, but have never found a law that forced banks to make bad loans. What was the law or regulation that required that they make bad loans that result in such horrendous foreclosure rates?

OTOH, banks make a great SHORT TERM PROFIT from making marginal loans, and the executives make multi-million dollar bonuses and profits from inflated stocks. Until they deregulated the banking industry, they were not allowed to make such loans.

Daniel

P.S. I AM the establishment. I don't know why class envy/warfare keeps cropping up. It's almost a nonsense term in this context.
 

Beamhead

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Re: Chase's overdraft fee scam

I've heard this asserted many times, but have never found a law that forced banks to make bad loans. What was the law or regulation that required that they make bad loans that result in such horrendous foreclosure rates?

OTOH, banks make a great SHORT TERM PROFIT from making marginal loans, and the executives make multi-million dollar bonuses and profits from inflated stocks. Until they deregulated the banking industry, they were not allowed to make such loans.

Daniel

P.S. I AM the establishment. I don't know why class envy/warfare keeps cropping up. It's almost a nonsense term in this context.
CRA circa the 70's and truly pushed since the second term of Bill Clinton (google franklin reins, jamie gorelick, barney frank, chris dodd.....) and you were arguing from a class envy/warfare point of view, others are free to agree or disagree with me but reread some of your posts.
 

Empath

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Hughes Federal Credit Union in Tucson isn't a bank. Credit unions are owned by their users, and the primary qualifying investment is through the earmarked "unusable" minimum placed into the savings account. If your credit union stipulates a $50 minimum investment, then you have to leave the $50 untouched.

Credit unions are a great resource. You are a shareholder. If you think there's a change needed in how they work, then start attending the shareholder's meetings, and make your voice heard.

Chase? I was Chase a user for a short period of time after they took over Washington Mutual. I removed myself from their clutches as quickly as possible.
 

bstrickler

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Hughes Federal Credit Union in Tucson isn't a bank. Credit unions are owned by their users, and the primary qualifying investment is through the earmarked "unusable" minimum placed into the savings account. If your credit union stipulates a $50 minimum investment, then you have to leave the $50 untouched.

Credit unions are a great resource. You are a shareholder. If you think there's a change needed in how they work, then start attending the shareholder's meetings, and make your voice heard.

Chase? I was Chase a user for a short period of time after they took over Washington Mutual. I removed myself from their clutches as quickly as possible.

That's some good information there, Empath. The problem is, I was never told that the $50 was unusable, until then. If I had known that ahead of time, I would have thrown more money into my savings account. That is both my fault for not asking if there were any limitations, and their fault, for not informing me of that.

I most likely will not close my account at Hughes, though, because it is nice that if I overdraw my bank account, it freezes it, to prevent me from screwing myself even further, but, it would be nicer, if they would design something for people who have limited, or no steady income, and have it so if you don't have the funds in your account, when doing a debit card purchase, it won't allow you to buy whatever you are trying to buy. That would save people a lot of money, and earn them a good reputation (and in turn, potentially earn even more customers).

I just won't use my Hughes account until I am able to find a job, and can have a fair amount of padding in there, for emergencies/unexpected purchases. I don't want to screw up again, when it can be avoided by paying more attention to my balance, and making sure I really need that item at the time. Plus, their hours & location (along with the lack of ATM's, for emergencies or whatever) do not cooperate with my schedule (I'm either asleep, or in one of my classes on the other side of town, when they're open), while Chase is right by my house, and I can head there if I need to sort something out, or check up on things.


~Brian
 

gadget_lover

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Re: Chase's overdraft fee scam

CRA circa the 70's and truly pushed since the second term of Bill Clinton (google franklin reins, jamie gorelick, barney frank, chris dodd.....)

Ahh. The Community Reinvestment Act. The one that specifies that SOUND loans should be made without discrimination. The one that has as it's only penalty... not allowing new branches or mergers. I imagine that would really scare a CEO into running his/her bank into the ground.



Daniel
 

LuxLuthor

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Re: Chase's overdraft fee scam

Ahh. The Community Reinvestment Act. The one that specifies that SOUND loans should be made without discrimination. The one that has as it's only penalty... not allowing new branches or mergers. I imagine that would really scare a CEO into running his/her bank into the ground.

Daniel

Take the time to read this link. Then you will understand how it evolved over time, and was used by regulators to force lenders to do things they should not have. You may still disagree, but you will understand. After this happened, the whole Ponzi scheme using derivatives and credit swap fiasco where worthless (i.e. subprime) paper was dilluted with more valuable assets and resold as a package--but done again over and over so dilluted any real asset value, it became the trigger. The bankers, investment firms, insurers (AIG), accounting firms, all became complicit with irresponsibly throwing more fuel on the fire. The first step of doing an initial mix of the crappy loans into a package with valued assets made reasonable sense. It was the repeated dillution that "screwed the pooch." At the heart of the problem however, was the liberalizing changes with bank lending brought on by increasing regulator pressures using the Community Reinvestment Act.
 
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gadget_lover

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Re: Chase's overdraft fee scam

Take the time to read this link. Then you will understand. You may still disagree, but you will understand.


OK. Read it. Still disagree. The CRA did not make bad loans as attractive to banks as the low interest rates and the profits to be made from refinancing loans for more than the property was worth.

Corporate greed combined with consumer ignorance combined with consumer optimism created that whole financial meltdown.

But that is so far off topic that it should not be pursued.

The good news is that BoA and Chase are both appearing to abandon the lucrative practice of paying bad checks and then charging cascading fees. That's a GOOD thing.

Daniel
 

LuxLuthor

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Re: Chase's overdraft fee scam

OK. Read it. Still disagree. The CRA did not make bad loans as attractive to banks as the low interest rates and the profits to be made from refinancing loans for more than the property was worth.

Corporate greed combined with consumer ignorance combined with consumer optimism created that whole financial meltdown.

But that is so far off topic that it should not be pursued.

The good news is that BoA and Chase are both appearing to abandon the lucrative practice of paying bad checks and then charging cascading fees. That's a GOOD thing.

Daniel

I respectfully suggest you re-read it, and my post again. It is not as simple as "Corporate greed combined with consumer ignorance combined with consumer optimism created that whole financial meltdown." I also did not ignore the impact of corporate irresponsibility in my post, but the cascade started with the CRA.

There is also nothing I have read that says that BOA &/or Chase are changing check or credit card overdraft charges. The only step I have read about so far only applies to Debit Bank cards.
 

burgessdi

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We have found a company WORSE than Chase... it's Citifinancial Auto...

Never saw such a effed up company in my life!!! :wtf:
 

burgessdi

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They have always had trouble processing payments. They would take a payment over the phone and then call and harrass and state there wasn't enough money in the bank even though there was.

On March 11, they took a payment and we got a confirmation number. On March 12 they called again saying the March 11 payment never took, even with a confirmation number. It wasn't anywhere in their system!! So we said ok, and made another payment and also got a confirmation number.

Two days ago, the bank, State Bank, (God Bless Em) informed us that two checks from Citi Auto were clearing and they put a stop payment on one check. Let's see how Citi likes it ;)

I guess it is a RARITY when we get someone who speaks understandable English, knows how to work their computer, knows how to take a payment and give a confirmation number and process the dang payment.

Not to mention their website for paying via web doesn't work!!

We started to take everything in writing especially the names and filed complaint with FTC for the harassing calls and threatening to wreck our credit.

They said we had anger issues so we said no, you need to stop pissing us off!
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