Sheila Blair, Chairman of the FDIC, wants to let you know that a few banks will probably fail during the current credit crisis, but you shouldn’t worry about your money because its insured up to $100,000 for a regular bank account and $250,000 for a self-directed retirement account (IRA).
Q: What if banks fail in the credit crisis? Will customer money be safe?
A former FDIC employee writes that the FDIC’s call center (877-275-3342) is “a tremendously helpful place to get basic referral information if you’re having trouble with your bank, lender, or finance company.” They can’t help you with complaints, but they can route you to the correct agency, provide credit union contact info, and give you the names and numbers of state agencies where your bank is located.
Banks just aren’t making the same profits they used to says the Federal Deposit Insurance Commission.
When Netbank went belly-up, all its customers and their accounts got converted to ING Direct customers, but reader Nate says they bungled his conversion and left him without funds, days before he was supposed to complete a cross-country move. He writes…
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The recent shutdown of NetBank is a good opportunity to review what happens when a FDIC insured bank closes and gets taken over by another bank. Basically, you’re safe, as long as your deposits didn’t exceed $100,000. [Kiplinger]
NetBank is the first federally regulated bank to fail thanks to the ongoing subprime meltdown. The failure spotlights the importance of FDIC insurance, which guarantees deposits of up to $100,000. Customers who abided by the FDIC limits and deposited less than $100,000 with the internet bank will become ING customers, and will have immediate access to their funds. The 1,500 customers who collectively deposited $109 million above the FDIC limits stand to lose half of their funds.
I am writing this note today on behalf of my 80 year old parents who have been banking with Washington Mutual. My parents account has had 10 forged checks passed on their 3 of their bank accounts. The fraud department has reimbursed one of the accounts for 2 checks after faxing a copy of the police report. However, today, after 20 days now, the fraud department has not reimbursed the other accounts. I have called fraud department many times now in an effort to recapture these funds in the amount of $1,100.00. Quite frankly the department was very rude and has been giving my parents the run around!
The FDIC has announced a program designed to study and encourage small dollar lending programs designed to compete with payday lenders. Under the program banks would offer “loan amounts of up to $1,000, mandatory savings components, payment periods that extend beyond a single pay cycle, interest rates below 36 percent, low or no origination fees, no prepayment penalties, prompt loan application processing, and access to financial education to help with asset building.”
When checking out all these whippersnapper online banks with their crazy high interest rates, you gotta make sure they’re FDIC Insured so you’re protected if they go under. But what does FDIC Insured actually mean? My Money Blog probes.
Consumerism Commentary has an update on the current online checking and savings rates.
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