There has been an ongoing problem with bank overdraft fees, particularly on debit cards.
In general, if you charge more on your debit card than you maintain as a balance in your account, the banks pay the charge but bill you as much as $35 for the overdraft protection. The fee will be the same even if your charge was only $5 over your balance in the account.
As if that isn’t bad enough, the banks are lumping together your charges for the day, and debit the LARGEST CHARGE FIRST against your balance. Why would they do that: simply because the largest charge was more likely to of putt your balance into the negative and then ALL THE OTHER CHARGES became overdraft with fees for each one.
That’s right: you go over your balance by $5 and then your next 10 charges may become overdrafts incurring as much as $335 fees on a $5 overdraft.,
Seems unfair? Of course it is unfair and there has been a public outcry and movement in Congress to stop these type of charges, especially when the individual did not even give permission to allow overdraft charges.
This practice has paid the banks BILLIONS OF DOLLARS.
Recently, Chase and Bank of America decided to revise their policies a step ahead of legislation that likely would have forced a change. These banks announced the other day that they would stop the nasty habit of debiting the largest expenditure of the day first, lower or eliminate overdraft fees and allow customers to CHOOSE OR OPT OUT OF OVERDRAFT PROTECTION.
What a revolutionary idea: allowing customers to choose whether to be excessivley billed!
Now, all this has not happened yet. Chase says that changes will take place early next year, but Bank of America says it will allow customers to turn off overdraft ability starting Oct. 19 of this year.
A few days later, Wells Fargo announced that they too would reduce overdraft fees.
Isn’t it amazing how these banks came to the rescue of their customers just after introduction of legislation? Senator Christopher Dodd 1 week prior to the banks’ announcements, introduced his bill to crack down on overdraft fees!
But BEWARE: OVERDRAFT FEES ARE STILL OUT THERE AND YOU MAY NOT EVEN KNOW HAVE AUTHORIZED IT!
Call your bank to check whether you may be the next victem of this insidious bank practice!
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