Forgive me, I’m a bit emotional over this. I’m raging mad and sad and disappointed because today Wells Fargo just lost my business. Yeah, I screwed up in this, but I’m a poor college student, and I thought I fixed it before it was a problem…
So, Saturday night I made two Paypal purchases. When I looked at my bank account, I noticed that I didn’t have enough to cover them, so I transferred enough to cover both purchases and the overdraft fee from my ING Direct account. Monday rolls around, my Paypal purchases come through, and my transfer shows up as pending. Okay, I thought, so I’ve got that covered, cool. Tuesday morning rolls around and my deposit has posted and I’m in the green, with enough to cover the inevitable overdraft fee. Then, Tuesday night I decided to check in on my account. TWO overdraft fees has posted, and I’m deep in the red. Not to mention I had bought a stamp today that puts me deeper in the red, though not by much. So I call Wells Fargo, explain my situation and confusion, and ask to speak to the manager. I’m put on hold, the music plays for a little while, then stops. I sit for another five minutes with no reaction from the phone, so I hang up and try again. I am transferred to the manager, but this time I don’t even get the music, it just cuts off. The third time I finally get through to a manager, who, after I explained the situation, informs me that, yes, every item will be subject to an overdraft fee. This means I might get another overdraft fee from having bought the stamp today.
I know this is mostly my own fault, but after about ten minutes on the phone I couldn’t even get her to reverse one of the fees because it “wasn’t a bank error.” I just think it’s a little unfair that I’m looking now at potentially over $100 in overdraft fees for something I thought I had corrected. Consumerist, I put this out as a warning. I used to love Wells Fargo, but now… the magic is gone. I have to move on. Probably to a Student Credit Union- I’ve heard good things about them.
-DM
DM,
In the final tally, deductions are taken out immediately. So if at any point there wasn’t enough money to cover the charge, there’s going to be an overdraft. Technically, you’re screwed, but if you call the Wells Fargo 1800 number and say please, they might show mercy and refund one of the overdrafts. Switching to a credit union is a good idea anyway, but don’t expect them to be more lenient on the issue of how quickly items are debited, though they might be more sympathetic when you overdraft again.
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I’ve had very good luck getting multiple overdraft charges reversed. If you have a record without many overdrafts, they will usually reverse some of them over the phone. The best way, however, is to visit a branch and speak to a banker (not a teller) and explain the situation. If you acknowledge fault but point out that ~$100 seems a pretty steep penalty when the funds were on the way, they may take mercy.
@pinkbunnyslippers: see, it was a small math error. I hadn’t accounted for shipping right away, and so I only overdrew by $2-3.
@Don Roberto: “Or at least, if they insist I login with my account, then make it patently obvious which funding source they’ll suck money out of.”
Paypal might not be a perfect system, but they ALWAYS tell me exactly where my money is coming from. It says “primary funding source” on the page, and then “back-up funding source” (or something similar) because I have a back-up set up. I then have the option to change those to any combination I want.
I realize you don’t use paypal often, so you might not have noticed this, but it’s right there on the payment page.
Disable overdraft protection. The feature is voluntary, after all.
Problem solved?
@theDM: the electric checking is awesome, but beware! if your whole point of the orange account is to save money, the electric checking is going to make that harder – not easier. i would recommend setting up an account at a local credit union for everyday spending & ONLY use the electric strictly for school expenses & emergencies.
as a student, i think you’ll find that a credit union meets your needs more than a large bank.
In order to be the devil’s advocate I have to say the position you’re in is all your fault. That probably makes me already one of the most hated people under the comments however, people should become more educated about their bank accounts. Honestly everyone should know that funds from checks aren’t available immediately, online transfers from different banks to banks can take up to a couple of days. However OD is something which is extremely difficult to pass by, even for employees. During training, it is emphasized that ODs cannot be reversed even for employees.
In all honesty, yes ODs suck, however there is overdraft protection as ANTEDILUVIAN mentioned. Also over draft charges differ from fees.
Overdraft charges are charged to your account everytime your account is overdrawn and you are still using your debit/check card. Fees are minimal and usually are $3 and are for everyday you’re in overdraft. Usually they escalate to something known as Level 2 Continuous in which you’re charged everyday if you leave your account overdrawn. Typically the charges are around $34.
I’ve had my account overdrawn several times and I’m in college as well. Most of the money I make goes back into school so I don’t have alot of money for myself. However early on I got into a hundred dollars in overdraft fees and I learned my lesson, the hard way.
Either way Wells Fargo is still at fault for not properly training you on what everything means on the website and in store, however you should realize that “Pending” is pending, as in the transfer is still clearing.
In reality, Wells Fargo is a actually a great bank. We do alot to protect customer’s account, more so than any other bank I’ve banked at. How do I know? Because I’m an employee. Yes I do hate some policies they have, however most of the frugal policies we have are there in order to keep your account safe.
As a lot of people have said before, you can speak to the branch manager who has authority to remove charges. Anybody else will NOT reverse the charges even if they have the authority because A) they’re not the branch manager B) the branch manager is usually dealing with the personal bankers and walking to and from the teller station to the Branch manager’s office is usually not allowed due to customer traffic if it’s busy.
In all honesty, just because you’re ignorant of a policy does not mean that everything can be fixed.
In your case, an immediate transfer cannot be done because Wells Fargo has to check that the transfer is legitimate and abnormal. Wells Fargo is a bank, they’re there to hold your money and make some money, and its ODs that help out.
Wells Fargo does charge a bit more than other banks, however I still think they’re a decent bank. I’m not sucked into corporate BS, but knowing someone close that used to work at a rival bank, Wells Fargo’s policies are indeed awesome. Even though it’s more work for their tellers.
I love it when consumers post on a consumer protection website defending banks’ sketchy system of posting and debiting by saying “well, if you didn’t live paycheck-to-paycheck it wouldn’t be a problem would it — tsk-tsk on you!”
This is the equivalent of when conservative chickenhawks say that if you don’t have anything to hide then you wouldn’t have to worry about the government secretly tapping your phone lines.
The point is: the banks policy, whether you live paycheck-to-paycheck or not, is sketchy. I’ve had 7-11 debits not clear for up to two weeks. For two years I deposited the same paycheck from the same local employer using another local banks, and every time it took three days for the paycheck to clear.
At the same time, the debits clear based on the VENDOR’S discretion not the consumer’s.
I don’t live-paycheck-to-paycheck anymore, but I share this person’s frustration from a time when I did.
I often wonder why in this day and age of paperless transactions and instant communications among banks why they “conveniently” have set up delays on deposits while at the same time most debits (but oddly enough not all) are instantaneous.
PS: I’ve heard the explanation over and over again and I disagree with it. The issue is that the banks make money of this odd system, and if they fixed the system of making communication among banks so that account verification — to make sure the money is available to transfer doesn’t take 2-3 business days — is faster, they wouldn’t be able to charge as many O/D fees. So why would they fix this problem unless the FTC finally sided with the consumer for once on banking issues and tells the banks they have to clear deposits faster, or process debits from LOWEST to highest rather than HIGHEST to lowest — which is a completely arbitrary choice based on which one will increase the likelihood of an OD fee, PERIOD.
The overdraft system is a scam. You’re right to abandon them and go with a credit union. Make sure they have decent policies for when you go under. No one should be pounced on so hard just for making an occasional error.
I’m feel a little sorry because I know how hard money can come by when going to college. But its really is his own fault like he said. An overdraft fee isn’t really a “one-time” thing. If you really think about it makes perfect sense that once you’re in the negative that you get CHARGED for each subsequent purchase you make while you’re in the RED.
Re: BY THEDM AT 10:17 AM…”To those who say “Oh, that’s just the way it is.” That’s not the point. The point is it shouldn’t be like this.”
Bad analogies aside; but No. The point is you knew better, and to make it worse, you knew the rules from before (“once bitten, twice shy” should have been your mantra).
If you don’t want to accept the rules & regs you agreed-to, then don’t try to force the system after the fact.
I know having and TAKING responsibility is hard enough for anyone, and maybe financial responsibility is harder-still for many younger people, but this is a case where the bank wasn’t the wronging party.
wells fargo will usually “waive” overdraft fees that are under a dollar so i wouldn’t worry about the stamp. and i have had a LOT of overdraft fees reversed, its easy to do, you just have to talk to and/or know the right people.
@DOMROBERTO –
You can set up your credit card on Paypal. I’d rather use my checking account, but there
have been times that I needed to pay for something and was waiting for funds to come
my way, etc… it does work.
Paypal is far from perfect, they’re subject to counterfeited spamming, AND they send a lot
of email I don’t want. If you look, though, it does list what account your payment is coming
from as long as you recognize the last four digits of your account(s). [It's also far more
commonly accepted, so far, than the google pay system.]
@olegna: i understand your post, but a lot of your frustration is unduly placed on the bank.
1) funds availability is regulated by the governing body of the central bank of the united states – the federal reserve board. regulation cc deals with availability of funds – you can read about it here (click on CC in the header to find info on the regulation) –>[www.federalreserve.gov]
the check 21 act has made the processing of physical items much faster (items can clear anywhere from 3 – 24 hours), but it is not mandatory for financial institutions to make the switch. once electronic processing becomes the standard for the industry, the frb will adjust their availability guidelines (& banks will follow). until then, reg cc is needed to mitigate risk (contrary to what you might believe, A LOT of checks bounce – including payroll checks. they are by no means “guaranteed funds” for deposit).
2) the VISA network is largely responsible for the lag time concerning purchases made with a debit card. PINed transactions are almost always posted to accounts same day or next day. transactions that pass thru the VISA network (for example, swiping your card at the gas pump WITHOUT entering your PIN) are often subject to a hold period (usually less than 3 days). posting can take even longer if a merchant doesn’t report their credit card sales to VISA on a daily basis. VISA is a private network & they make the rules (not the bank), so the chances of the ftc doing anything about it are pretty slim.
most people don’t understand that when it comes to items that clear your account (credits & debits), a bank is just the RECEIVER. another bank tells them to credit or debit & when to do it, all they do is post it when that date/time comes. they don’t actively manipulate posting items just to make a few bucks. the posting process is completely automated.
BUT, a bank’s policy should be to work with a customer. fees are ALWAYS reversible (losing a customer for life usually is not), it’s just that the incentive is rarely there to do so for a college kid or a person living paycheck to paycheck. throw a 100K or two in most banks or book a 500K+ in loans & watch how quickly that changes. not only will they reverse all your fees, you’ll walk out the door with a t-shirt & a george foreman grill!
banks ALWAYS make exceptions…it’s just a question of who they’re making them for.
@MonkeySwitch: who spends $6.50 at taco bell?
p.s.
The OP might want to consider keeping his/her accounts i a spreadsheet. I’m far more likely to open Excel (or, depending on which computer I’m using, OpenOffice) than I am to look at the little booklet with my checkbook. If you’re writing to the Consumerist and not to the bank, right now, you may think like I do.
If you DO get helped, PLEASE send the bank a quick thank you card. Via US Mail, with a stamp. I can’t tell you how much my bank bends over backward to help me, ever since they realized that I’ve been copying complimentary notes (my checking account has been compromised) to their Personnel department.
The decision to remove your fee, or not, will be made by an individual.
The fee probably shouldn’t be removed. If a person does you the favor of removing a fee caused by
(1) your not checking your balance and
(2) ING’s transfers not being immediate (or, in this case… transferred five days too late, considering that they take five days to go through),
you OWE thanks. This wouldn’t be his or her “doing their jobs” but “going above and beyond.”
I’d strongly suggest that thank-you. it will be a more important lesson than those fees, especially if you go into the business world.
No, it’s a scam plain and simple.
If there isn’t money to be withdrawn from a debit card, the bank should just not take money out of the account. The payment doesn’t go through, and a purchase isn’t made. Thus the cardholder knows he’s got a problem and doesn’t overdraw and gets money into his account first.
But that’s not as profitable as processing it and charging an exorbitant fee. That’s the reason it defaults to just withdrawing instead of rejecting. So say a stick of gum, a burger, and a piece of paper costs about 200 in overdraft. Good for them, bad for you.
Call them and have their overdraft “service” deactivated. That, or pay with credit cards only, never pay with debit.
@NoWin: They’re not bad analogies. Business is business.
@exkon: But shouldn’t it be a one-time thing? Especially if both purchases post at the same time since I bought both of them on a weekend?
oh, and for the record, I was assessed an overdraft fee (34$) for the stamp.
@theDM:
I guess if you argue your point it could be a “one-time” fee but its still two separate purchases. I don’t work for the bank or anything, but I have a friend that does.
Though I know its a harsh fee, but its really to deter people from overdrafting or telling be more careful with you money.
Which would you rather have: an overdraft fee or your card getting denied?
@exkon: card getting denied, every time. I’d rather be denied and have to go to a Credit Card (especially since I know I have money in a savings account) than have to pay $34 for a $.41 stamp.
For a small insight (layman friendly verbiage) at what a portion of item-processing entails from the bank side can be seen at this weeks topic entitled: “Bragging Rights” at [www.Gonzobanker.com]
Disclaimer: I have no affiliation with that website, but I do read it regularly.
Knowledge is power. Use it wisely.
as a former WF customer during my college years, i’m unfortunately very familiar w/ this little routine. i was disconnected more often than i was able to actually speak with a manager. heads up, you’ll probably be charged a nominal fee for calling the phone banking line.
Wells Fargo lost my business recently for similar reasons. If they’re going to treat withdrawls as instantaneous, they need to treat deposits and/or transfers the same way. It seems to me that withdrawing money from one account and delaying the transfer/deposit to another account constitutes unauthorized borrowing. I don’t believe that the bank should be holding on to money that isn’t – technically – in their clients’ accounts. “Pending” drives me crazy. That and Wells Fargo charging $2 for using a non-Wells Fargo-branded ATM. On top of the $1.50 (Costco) to $5.00 (Las Vegas) ATM-specific fees.
I’m now a member of a credit union in my area that allows me to avoid ATM fees at any of the numerous credit union ATM’s in my area. They also have a great – and FREE – overdraft protection feature. Overdraft protection is a joke at Wells Fargo.
@Don Roberto:
They can. If the account you’re paying is merchant or business, they accept cards for free. If it is personal, they will be charged. You simply do not log in to paypal when paying, but use the credit card form below the login screen.
@kelbear:
As much as we hate paying for the OD mistakes we make, what should they do? Not charge for overdrafting and continue to let people overdraft and charge things on their accounts without penalty? One could argue that the people get penalized by spending money they do not have, but since when do people really, truly learn from that?
Also, I highly advocate padding an account. Keep as much as you can in high interest savings, sure, but don’t keep only $300 if you intend to spend $299. You never know what might come up and you never know how long things take to transfer. Keep enough money in there for any likely situation (and perhaps a few unlikely situations).
FYI, this varies from bank to bank. With my bank (TCF) the overdraft fee was posted at midnight, so you were cool with an overdraft and then a quick transfer after the fact. Back before I was, like, employed that was really nice.
Am I the only one that remembers when overdraft protection meant the bank would float you the extra cash without a massive penalty provided you took care of it within a day or two?
I agree that you should watch your balance. That’s all great but it doesn’t excuse the fact that the penalties levied against the customers far outweigh the customer error the vast majority of the time.
dont be too hopefull, im with alliance credit union and even though i deposited my check on a wednesday through thier atm, and the money DId show up in the account it wasnt available until jsut about a week later(for example it says accout balence $2500, available $40), so a weeks worth of purchases(about 8 purchases) got overdrafted because apparently “ATM’s dont go through immediatly” i understand that, but a whole week, with my money sitting in my account but not accessable? thats a crock of sh!take
At my bank (BankAtlantic), transfers (savings to checking or vice versa) are instant, so there’s no worries about when the tranfer will post.
Overdraft fees are excessive and a ripoff–it doesn’t cost the bank anything to advance a payment–no money is involved (there is no money), only electronic credits.
Just remember–the whole banking system is based on fraud.
DM might want to consider signing up for Wells Fargo’s new Teen Checking Account.
According to the Ironwood Daily Globe ([www.ironwooddailyglobe.com]):
The account, for individuals ages 13 to 17 with an adult co-owner, combines: financial education, parental controls such as daily spending limits on debit card purchases and ATM withdrawals, money management tools and account alerts.
“The Teen Checking account is the driver’s permit of checking accounts,” said Susie Boxer, Wells Fargo Community Banking president in Houghton and Ironwood. “Before we let teens set out on the open road, we make sure they have adequate skills, supervision and practice to make good decisions behind the wheel. The same is true for a checking account. Teens need guidance and an understanding of the responsibility they’re undertaking.”
I understand it’s for ages 13-17, but DM’s daddy might be able to finagle it.
Here is a story for all my American friends. I am Canadian and in the last while have spent more time across the border in North Dakota. Great deals with the exchange rate.
So I decided that a bank account with a big US bank (Wells Fargo) would be a good idea. Mainly to get a US credit card. Since I had no credit in the US, Wells Fargo gave me the option to take $300usd of my money and give me an secured credit card with a $300 limit along with a checking account. 12 months later they would look at my history and I could then be eligible for a un-secured credit card. Well 12 months went by, I was perfect with the card and I called. They said sorry you have no credit history. I said “yeah, hence the 12 months of you holding onto my money and creating a credit history”. Sorry.
So I decided to kill the credit card and keep the checking account since the debit card works like a Visa also.
Well my wife and I are building a house and decide to head down south with $1150. I deposit it into the branch in cash. We spend a day, I use debit where I can and on occasion they swipe as visa. All good. Wrong. A few days later I get this call on my cell saying I am $500 overdrawn and have to make a payment ASAP. I was like, “What The …” I check the online banking and see that I was 153.13 overdrawn and had $302 in fees. I sent a check for the 153.13 asap and told them they will not get any fees from me and close the account.
10/10/07 DEPOSIT MADE IN A BRANCH/STORE #16151872 +$153.13
10/04/07 CONTINUOUS OD LEVEL 2 CHARGE $5.00
10/03/07 CONTINUOUS OD LEVEL 2 CHARGE $5.00
10/02/07 CONTINUOUS OD LEVEL 2 CHARGE $5.00
10/01/07 CONTINUOUS OD LEVEL 2 CHARGE $5.00
09/28/07 CONTINUOUS OD LEVEL 2 CHARGE $5.00
09/27/07 CONTINUOUS OD LEVEL 2 CHARGE $5.00
09/25/07 OVERDRAFT FEE $34.00
09/25/07 OVERDRAFT FEE $34.00
09/25/07 OVERDRAFT FEE $34.00
09/25/07 OVERDRAFT FEE $34.00
09/25/07 OVERDRAFT FEE $34.00
09/25/07 OVERDRAFT FEE $34.00
09/25/07 OVERDRAFT FEE $34.00
09/25/07 OVERDRAFT FEE $34.00
Balance Due $302.00
14 days overdrawn and they expect to get 200% of the overdraft amount in fees. Good luck!
I though we got screwed in Canada, no way. They nickel and dime us all year, but charge very little when it comes to overdraft. Average here is $5.00 overdraft fee per month and the daily interest until paid. With a $4 a month bank account.
I guess Wells Fargo makes the good customers pay for the bad ones.