Bank of America to eliminate overdraft fees

While this sounds good on the surface, and may be good for some, there will be consequences. The size of the fees they got for overdrafts was very large. I'd have to pull the WSJ to get the number, but it was large. Those fees subsidized other services. Early speculation is it will end free checking unless one maintains fairly large balances.

In the end, they will have to find another source of funds, or reduce services that weren't paying for themselves. We'll see where it goes, but fees won't just go away with no offset.

Best,

Dave
 
The Law of Unintended Consequences.

That money will resurface somewhere.
 
Banks, Airlines (and in many was the entirety of corporate America) long ago quit making money "the old fashioned way"...i.e. honestly, up front, and clearly stated.

They'd much rather use the back door. “Wanna do business with us? Bring your Vaseline”.

When it comes to banks, fortunately I keep enough money in all my accounts to avoid any charges and closely watch all my balances (download into quicken almost daily). But, unfortunately it is those who can least afford it who bear the brunt of all these immoral and reprehensible business practices.

I used to bank with BOA. I loved their online banking. I hated everything else about them. They’d lay like a snake in the grass waiting for you to walk to close so they could strike. Fortunately for me I was a large enough customer so that, on the rare occasion when they’d try to hammer me with a BS fee, I could simply call my local bank and get the charges rescinded but the little guy…he’s just pretty much screwed.

I finally changed banks after I grew weary of BOA not caring about the security of my identity and regularly putting me at risk for identity theft.

And customer service? Forgettaboutit. The local banks are run by a bunch of high school kids (okay that's an exaggeration but not much) who have absolutely no authority to do anything. Well, except overriding nefarious fees.
 
flyersfan31 said:
The Law of Unintended Consequences.

That money will resurface somewhere.
Click to expand...

Since Ken Lewis got the boot, they can afford to waive some fees. He cost BoA about $250 million in salary, bonuses and retirement benefits...and what a swell job he did for that 250 mil...


Trapper John
 
rpadula said:
Instead of covering your purchase when you're overdrawn and charging you a $35 or so fee, BofA will instead soon be declining your transaction. Debit cards only.

Perfect for those who are too lazy to balance their checkbook...

http://latimesblogs.latimes.com/mon...ica-junks-overdraft-fees-for-debit-cards.html
Click to expand...

Sounds good to me. Now if we can convince them that with Check 21 and other EFT tech, there's no need for the absurd 'hold' periods that banks like to claim they need to deposit a check into your account.
 
wbarnhill said:
Sounds good to me. Now if we can convince them that with Check 21 and other EFT tech, there's no need for the absurd 'hold' periods that banks like to claim they need to deposit a check into your account.
Click to expand...

Ain't that the truth!

Another great BoA story...

A buddy of mine, George, had a son, Josh, in college. George is an attorney but don't hold that against him.

It was time for Josh to buy books for the next semester of classes. George deposited the appropriate amount of money in Josh's checking account almost 2 hours before the cutoff for it to be credited to the account that business day. Josh buys his books at the bookstore that evening (note "evening" about 8pm). Josh get nailed with overdraft charges.

But here's where it gets fun. Josh had made about a half dozen routine purchases during that day since he, like many kids, uses his debit card for everything. But BOA took the book store purchase out of his account first (even though it was made last) so they could charge him numerous overdraft charges for all those purchases he made during the day. And as is noted above the book store purchase was well after business hours so it should have showed up on the next day's business anyway.

Did I mention that George is an attorney? He had the receipts and the deposit ticket with the date & time stamps.

He had quite a good time with this.

Karma. I love Karma.

I've been told nearly identical stories by a few others.

Did I mention I love Karma.

Note: the names in the above story have been changed to protect the fun lovers.:D
 
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Dave Siciliano said:
In the end, they will have to find another source of funds, or reduce services that weren't paying for themselves. We'll see where it goes, but fees won't just go away with no offset.
Click to expand...

flyersfan31 said:
The Law of Unintended Consequences.

That money will resurface somewhere.
Click to expand...

All true.


timwinters said:
Banks, Airlines (and in many was the entirety of corporate America) long ago quit making money "the old fashioned way"...i.e. honestly, up front, and clearly stated.

They'd much rather use the back door. “Wanna do business with us? Bring your Vaseline”.
Click to expand...

:rofl: LOL Tim. You win!

It always astounded me that people didn't know when their next transaction would overdraft them and they'd get bitten by these fees.

However, I don't think this change has anything to do with goodwill for the consumer. The recent law change made it so this nefarious scheme couldn't automatically be foisted upon the unsuspecting. (where's da sarcasm tag?). So, banks started sending out letters like this to get people to opt back in.

My guess is they didn't get many takers.
 
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