Bank Ripoff !!!

[RubHer Yellow Ducky]

Purchases Trigger Overdraft Fees Before They Clear


Kathy Chu
, USA Today
posted: 2 DAYS 2 HOURS AGO
For years, banks have charged customers hefty fees for overdrawing their checking accounts. Now a growing number of institutions are charging customers such fees even before the transaction overdraws their account.
Bank of America and TD Banknorth started doing it earlier this year. SunTrust, among other banks, has been doing it for a few years.
Here's how it works: If you pay with your debit card, some banks will now charge you a fee -- $35 or more -- if you don't have funds in your account at the time you sign for the purchase.
Previously, you didn't get charged this fee unless you were short of cash when the signature debit transaction cleared a few days later. That meant that, while the signature debit transaction was pending, consumers could often deposit money to cover any potential overdraft. (By contrast, PIN transactions typically clear immediately.)
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Leslie Parrish, senior researcher at the Center for Responsible Lending, argues that this is "another way (for banks) to manipulate account holders' balances to spur more overdraft fees." Banks defend the practice, saying it provides customers with accurate information about account balances.
Banks' changes come as regulators weigh whether to crack down on overdraft practices. The Federal Reserve has proposed a rule to give customers the right to demand that banks deny transactions that overdraw their account. The Fed has also asked for comments on banks' processing of transactions from high-to-low dollar amount. This practice, according to USA TODAY research in 2006, often triggers more overdraft fees than if banks paid the transactions in the order they were received.

[05h2sut]

I'll probably get in trouble for saying this, but

I agree that the bank account holder should have the money before they spend it. The fee is outrageous, I suspect similar to bouncing a check, which is essentially what one would be doing spending before they have it. I've had friends give me checks with the "don't cash until Friday" statement attached. When I loaned them money, it was then and there. I should now start surcharging $35 for the Friday statement.....

[RubHer Yellow Ducky]

your right, don't spend what you don't have...except on a good credit card that you can pay off every month, 11 months out of 12 (your allowed 1 month a year to have fun)

DEBIT CARDS ARE DANGERIOUS...You DO NOT have the same protection as on a crerdit card...in fact a merchant can charge you a fee to use a debit card which they can't on a credit card...

[Big Dad]

Reminds me of a Clapton & Cale song....

"...if tomorrow never comes, then everything's free..."

[wpage]

These Bank fees are a outrage...

I imagine its the reason they are still building them on every corner!