this makes me not hate BoA so much.

the speed of their reaction shows the greed of their earlier choices.

When you can check your balance online, on the phone, via text or at any of thousands of ATMs worldwide, why are people still overdrafting their checking accounts?

Want to spend money you don't have? That's what credit cards are for!

@TinaBringMeTheAx: :sits back with popcorn, waiting for fireworks:

@apd09: Hey hey hey now. Let's not put the cart before the horse.

I know it's been said over and over.....

Manage the money in your account and you will never have this problem.

I always round my deposits down when I write them in my register.....it has easily given me a $300 cushion over the last few years. A few cents should make no difference to anyone. It adds up and you won't ever have this worry.

They may be limiting the amount of times they charge you the overdraft fee, but nothing here says the banks won't raise their already exorbitant fees to make up the difference.

It doesn't matter if they only charge me three fees per day, if they double it from $50 to $100.

I have no sympathy for people who bounce checks so if they get hit with fees tough darts. If you need help adding and subtracting get a calculator. And stop using a debit card for everything. This way you won't have to remember what you bought. Just go to the ATM and get some cash.

Bank of America got me once real bad. Over $240 of overdrafts caused by a purchase of $3.32 in addition to a check order that hit 2 weeks after purchasing them through BoA. The day after the $3 purchase I deposited $123 and assumed I was good (it was the weekend). Come Monday the fee from the $3.22 hit, as well as all the purchases made during the weekend. Needless to say I was livid. They would only reverse enough to make me $4 positive over the phone, but it took more than a day for all the fees from the weekend to hit. So I was positive $4 on Tuesday, negative $200 on Wednesday. This was all from a purchase the previous Friday. Went to a local branch and got the friendly manager to grudgingly reverse the fees, which was surprisingly simple from what I saw.

As far as the "permission" goes, Bank of America is actually giving the option of not going in to the red at all but there are many drawbacks to this new "feature." As an employee of the bank, I cannot go into great detail but what I can say is that if provided the option it is best to not sign up for it. Why? If you sign up for this program, you will literally never be able to go into the negative. In the event of an emergency and you're signed up for this program, Bank of America will basically say, "Unfortunately, the disclosures were provided to you at the time you signed up." If your account is set up for automatic payments, they will NOT go through if they result in your account going into the negative. In addition, signing up for the feature will not only be a headache but trying to get out of it will be worse.

@apd09: This makes me hate them more - they are quickly trying to stop their cash cow from being completely killed, by making their raping more reasonable, in the hopes that the legislation, which is more sweeping, won't pass.

They are just greedy scumbags and I wish the worst on them... right after I get off my lazy ass and close my account.

@apd09: It's like they said "we'll only rape you a little."

@mzlinax3: " If you sign up for this program, you will literally never be able to go into the negative."

And the problem is.....?

If you don't have sufficient funds the charge should be declined. You can't tell me that in the year 2009 we can't have bank accounts with automatically updated balances after a purchase. If I can buy lunch at Subway and see that charge reflected by the time I go back to my desk, there is no excuse for why my account's balance can't be up to date electronically.

Just remember that your company made millions on these overdraft fees - they're seen as profit, nothing more. Keep that in mind when your employer is telling you how bad it will be to not have the ability to incur these charges.

Without a law in place, 3 years down the road when everyone has forgotten it, they'll just re-institute it. Make it a law so it has some staying power, I say.

@TinaBringMeTheAx: *sigh*

We really need to have a bot that answers these questions. Because though 90% of the time it is some jerk acting all holier than thou, the rest of the 10% would probably benefit from that answer.

Thats my request for the new version of commenting system. Just comment with a "@bot overdraft_accident " and within minutes, the bot will come over, and post an automated reply which has been refined by users. That way we avoid a flamefest and do not miss out on any important points either.

@mzlinax3:

That program sounds great! It is just what I would want if I was a BoA customer! If I don't have the money in my account I *want* the charges to be declined. Emergencies are what credit cards are for. Even the usurious interest rates that they charge pale in comparison to over draft fees.

Since this new program is so awesome I am sure that there is a $10 monthly fee or something so that BoA can continue to monetize their customers.

@CaptZ: It has also been said over and over what exactly the problem with that particular scenario is.

I keep a $1000 cushion to cover accidental and expensive charges, but it wont be of much help if some software goes bonkers and posts the same transaction over and over again, or if instead of 100.00 someone types in 100,00.

@DoubleEcho: Do you bank at Bank of America? Let's be real. Crap happens. Bank of America allows me to go into the negative a couple hundred dollars and while it sucks to have to pay those fees, sometimes I really need that money. Let's say I spend $500 at the mall and I have a balance of $130 left but my car breaks down. Completely dead. I don't have a credit card, I don't have AAA, roadside assistance... None of it. I'm going to need to take the remaining balance of what's in my account and possibly more. Are you saying that if you were in an emergency situation you should just be screwed over? That's why Bank of America has that capability available. Not everyone has the credit card to use for emergencies. Not everyone has someone they can go borrow money from.

People come into the bank all of the time that put their accounts into the negatively purposely because they don't have any money to eat. If any of these people were to sign up for the program, they would be SCREWED.

@mzlinax3: This is a choice that many people would be more than happy to make. It should be a no-brainer that if a "customer" has both a checking and savings, monies should be pulled from the savings to cover the checking BEFORE any overdraft protections are applied.

Too often banks simply say "you never signed up for this program" and that program just so happens to not allow the bank to make so many overdraft fees.

There was an era when banks would not let you overdraft. The world did not come to an end. So it won't again. If you have automated payments coming in, you should, as a reasonable person, have enough "buffer" in your account to cover a month's worth. Or, better yet, open another checking account and have all your automated payments go through there and a monthly transfer to fund that account. Works great with me and my family.

Then again, I have a long relationship with a local bank. Not a big soulless one.

@Radi0logy: And you know what is sad, my wife and I each have a BoA account and most likely are going to open a joint account from them this weekend because the devil you know is always better than the devil you don't.

@apd09:

It's retail banking. It's neither complex nor fraught with risk. I'm fairly sure you can open a joint checking account without boogeymen swallowing you if you merely keep it funded.

@mzlinax3: Do I bank there? No. But perhaps these people you speak of don't have any money to eat because they're constantly getting dinged with $25-30 NSF fees per overdraft transaction.

How in the hell can you even argue that this is a service people enjoy using? It's almost as bad as a payday loan.

And if you spent $500 at the mall, leaving you with $130 and you have no backup funds or a credit card? That's your own fault, because that's a hell of a lot of money that I'm assuming wasn't for necessary purchases.

@CaptZ: Doesn't always work that way. Ever made a deposit, only to have your bank hold it for a week or more? This is what causes many people to overdraft. You would think that putting money in your account would mean you have, gee, MONEY IN YOUR ACCOUNT. But greedy bank practices make this not always the case.

@TinaBringMeTheAx: Because electronic balances aren't always accurate. The one time I ever over-drafted was when I went and checked my balance online just before I made a purchase. Literally as soon as I made the new purchase a ton of stuff cleared including a larger purchase I had made electronically some two weeks earlier. I had assumed wrongly that two week was more than enough time for anything to clear and that the online balance reflected that. So basically unless you're carrying around a checking account balance ledger the online balance information is pointless. They need laws on how long they can hold electronic transactions, and what order they must clear in.

@PeteyNice: There are no hikes in Monthly Maintenance fees or OD fees as of yet. If and when they do, they will, what can we do? There is no Monthly fee for that service but like I said, it's just going to be a really big hassle to sign up and an even bigger one if you change your mind.

I'm sure they'll still do the "largest transactions first" policy that nets them so much in fees anyways. they held a deposit of $2000, that i put in to cover a check, once for an entire week. They didn't tell me, so i made some purchases that put my balance under the limit, each were like 2-5 bucks, and took a bit of cash out. I had enough at the time to cover the small purchases/withdrawal but not the check. Somehow, the check posted 2 days after i made my other transactions, but they all posted the day after the check went in. i got hit with close to 300 in fees, even for my ATM withdrawal!!! i got it worked out thankfully, but still...

On October 21st or so, wait for the floodgates to open with the complaints from the other side.

"I was only going to be overdrawn 1 penny and they BOUNCED my car payment!"

or:

"I was arrested for not paying for my lunch when my card would have only been overdrawn by $2! They declined the charge!"

etc.
etc.

I don't see any other way for the banks to respond. Have they published the updated TandC yet? I wonder if they are going to go to "closer" to real time check processing. My work bank processes 95% of the (outgoing) checks by 10am, and 99% by noon. They'll probably activate that for personal accounts as well. So you leave for work with $100, your check for $75 clears at 10 am, and your lunch is declined via debit card....

(Note: I am not automatically siding with the banks, but these overdraft fees in most cases can be avoided by keeping a register and knowing the banks' funds availability policy. I FULLY support what the Fed Reserve was proposing, which was that overdraft fees would be verboten if they are caused by a charge that is invalid or never settles, like a holding charge for a deposit. Granted, that would mean that the banks would have to create software to figure out overdrafts over a balance in time....I don't believe the urban legend that banks 'hold' checks in order to cause overdrafts. My work bank clears checks quickly - the same night they receive it. Also, even if the bank were to 'hold' checks looking for an overdraft, a proper check register would not allow an overdraft to happen since you wouldn't spend money that you didn't have! Again, that's why I support the 'no OD for errors' clause.)

@TuxthePenguin: I don't disagree with that in the least bit but crap happens. Bank of America customers are provided with the option of setting up overdraft protection FROM THE SAVINGS ACCOUNT in the event they do not have sufficient funds in the checking account to cover.. but you don't know how many times a day people come in saying, "I have ODP set up but why did I get charged with all these fees?" Then we ask them, "Did you have the funds available in your savings account to cover?" The response, "No."

If a customer comes in and had the funds in the savings account to cover and they should have been signed up for the feature, Bank of America will give you the fees back.

@mzlinax3: Didn't see your post. But bingo.

Those who still write checks are going to be hurting big time if they don't keep a register. I still wonder if check processing is going to be moved up. It's impossible to have a "transaction date/time" processing system (process based on when transaction received) because checks aren't sent on the same real-time system - yet. Check 21 does eliminate all float except overnight. If the bank processes the check the same day. Locally, my company uses 2 banks. The local one will cash checks overnight. The big bank used to take 3-4 days to cash a check. (transfers between our accounts), now it's down to 1-2 days. I think they used to truck their checks to another town for processing, which explains the delay, but now they are using Check 21 to the fullest. The other bank - the local/regional one - is now doing Check 21 at the bank teller.

I'm a Bank of America customer. I'm also an ING Direct customer. ING provides you with a small line of credit when you open a checking account. If you overdraw your account, the amount is deducted from your line of credit and you're charged a small interest payment rather than a daily fee. I think this is a fantastic service, and I hope that competitive features like this will also help to keep large banks on their toes.

@morganlh85: Well, as soon as people stop depositing secret shopper funds into their account and withdrawing a huge portion of it, maybe the banks will begin trusting their customers again. Granted, I do agree that they need to change their hold times to meet the real world (like 2-3 days tops because of Ck21), but it still can happen down the road where a deposit 45 days before bounces.....

I don't think the new ATMs that can deposit cash are putting any kind of hold on them beyond midnight that same day....

My bank offers overdraft insurance for $35/yr, plus 19.9% interest.

My AmEx bill is due in the same pay period as my mortgage. (AmEx due on the 13th of the month). My direct deposit hits on the 15th, and if AmEx is due on a weekend, I have no problems. Otherwise, I pay maybe 25 cents in fees.

The overdraft insurance (up to 2000 overdraft allowed) really comes in handy in the times I need it.

The core problem is a lack of money. Fees or no fees, these changes don't solve that problem for consumers. The thing is, eliminating the revenue stream associated to the dispute allows banks to adopt the PR high ground - 38B is a heavy price to pay, but banks badly need to improve their image.

The other subtext? Local banks do this to, and they have far less revenue diversification than conglomerates like Chase and BofA. They have brokerage business and asset inventories that can pick up the slack. What the hell is a local bank going to do when their commercial real estate loans sour and they've lose this revenue source? Look for them to go under, and for the consolidation of the banking system to have been facilitated by the very lawmakers that sought to prevent it.

@apd09: isnt stopping me from moving to a credit union.

They still havent said they are going to change HOW the charges are levied. They have been pretty blunt in the past in saying they will levy larger charges first to bring you overdrawn before levying smaller ones.

@TinaBringMeTheAx: Even if you take the complete personal-responsibility route that no one should ever make an error projecting the balance of their own account(s), there are many examples in these pages alone of companies taking a payment out multiple times, or moving the decimal point a few places to the right.

The banks aren't going to just lose that profit and tell their shareholders that it's for the greater good.

There will be new fees for other things to enrage you shortly.

@YamiNoSenshi: So they'll use the sandpaper condom instead of the cheese grater one?

@mzlinax3: I'll tell you what - switch the processing order so that the smallest transactions go through first, and I will agree with you that the way your bank handles overdraft fees isn't evil.

@CaptZ: Everytime I have ever overdrafted it is a result of the following:

1. My statements are not accurate due to inefficiencies in the bank's system. What I see is not what I have.

2. There was an error as a result of either the bank or some other retailer which charged my account for an amount that I did not permit.

3. The bank holds the check longer than expected. ShruggingGalt, your theory about the banks consistently not holding them beyond midnight that same day if you make a deposit at the newer ATMs is not accurate at all.

4. The transactions that I make sometimes show up as a very small amount such as $1 at first, but then change sometimes up to 5 days later as the actual amount that I paid. This issue has been a problem for me particularly when it comes to transactions I make at gas stations.

The point is that the list goes on and on and on and on. Yes, for each reason there is a "way" to prevent it, but at what point does one say that enough is enough. These banks are profiting by billions of dollars per year thanks to these practices and they claim that they are only doing it to "protect us" which is a load of BS. To make matters worse, there is no choice. The people do not have competition out there to turn to which does not follow these same practices. The only way it is going to change for the best permanently is if new banking regulations are put in place which allow the consumer to choose the responsible decision every time they could potentially overdraft during the time that the transaction is about to take place. That's what consumers want. That is not what they are getting and they have no choices to turn to. It's time to put an end to it all. It has been abused for far too long.

@Radi0logy: The way I see it, with government legislation, they'll be required to make much bigger changes. So, instead, they'll make positive changes that won't kill the complete cash cow that is overdraft and hope that puts a stop to it.

..... cue 2-3 years later. They avoided laws being passed, so they will sloooowly start reincorporating these fees back into accounts.

..... cue lawmakers getting upset again about the raping of a new generation. They'll make changes yet AGAIN, avoid laws being passed...

The vicious fucking cycle never ends do it.

@TinaBringMeTheAx:
Because banks have algorhythms that deliberately hold deposits/take out charges in the precise order it will make them the most money. If banks took debits out in chrono order, people could keep track online as you said, but they don't.

My wife was overcharged (doublecharged) $200 on her debit. Would have been in the hole had I not happened to check something. We should not have to check our balances daily to protect ourselves from predatory banking practices.

@DoubleEcho: These people that don't have the money to eat because of the multiple fees, that's also possible. I don't deny that. Those people can go to the bank and ask for fees back. But sometimes, stuff really does happen. Are you saying you always some back up funds? More responsible people do have back up funds available. But sometimes even those funds are exhausted.

I never said that people "enjoyed" this service. I said that people do knowingly put their accounts into the negative because they need the money.

Lastly, are you saying that people should be able to see the future and know when his or her car is going to break down? It doesn't matter if the $500 a person spends is necessary or not, they spent it because they had it.

People don't always plan for emergencies. Do I personally think that's dumb, of course I do, but some people just don't plan for it.

@AllanG54: But the ATMs will happily overdraw you as well.

Yes, people should be responsible. But in those 5-10 percent of times when a non-human or merchant error causes a problem, you shouldn't have to deal with 5 x $35 on top of the error.

You should also have the right to ask that your card not do transactions if you don't have the cash- in fact, you should be able to limit the account- you should be able to say "if I have less that $200 in my account, reject my charge". That would be a simple failsafe that would not only help responsible people, but would help people new to banking.

I, for one, don't think 18 year olds should pay hundreds in overdraft fees to banks to "learn a lesson".

@Geekybiker: The best system is to add up all your bills a month, deposit about $50 more than that into your account, and pay bills only. Take out cash for your daily/weekly purchases like gas, and deposit the rest into a savings. The checking account is only used for bills!! If you wish to make an online purchase, deposit the extra cash into your checking account for the exact amount needed.

Too many people screw up because they use their checking accounts for small everyday purchases and they ADD UP QUICKLY, and who can keep track of them without a checkbook ledger?

I have a great memory for numbers, and I round up purchases in my head and subtract from the balance. But some people aren't that good at it, thus you need almost a full proof system to avoid those overdrafts.

@MostlyHarmless: Can I haz some cushion, peez?

Legislation is needed whether the banks change their policies or not. There needs to be something enforceable, something the banks can't change their minds about in a few years when people aren't looking.

@DoubleEcho:
Banks like to claim that they are doing you a favor by "allowing your mortgage to go through even though it overdraws you"--

Guess what- I have a TON of leeway on my mortgage. If I pay it and don't have the $1000 in the bank, fine-- I always pay it on time, so I can pay it in 2 wks and add on the $15 late fee (cheaper than the $37 overdraft fee). If I somehow am way behind (never happened to me) I know it'd be months before I'd have any real trouble with 'em, plenty of time to get that 2nd job.

There is not one single "large" bill I have to pay that I can't put off if I really need to because I'm generally on time w/everything.

So this policy hurts me.

@mzlinax3:
And I would recommend that someone like that should not sign up for the program.

The point is people should have options. I love it how people are all for personal responsibility, but giving people a choice on how to manage their account people become concerned that people won't like their choices.

Guess what- I'm a grown up. Give me a choice, and I'll take it like an adult when you cut me off cause I'm overdrawn.

I just got a notice from Discover car that they are already implementing good things on our account. When I saw we had a message waiting on the account I panicked but turns out they are not being dicks. ..... yet.