I understand returned payment fees for checks, but I’ve never been charged for having a credit card decline.
Stupid of me to sign up for auto-payment when I use my credit card for gas, I guess.
It’s expensive being poor. I used to get charged £15 if I didn’t have the funds because I wasn’t allowed an overdraft. Being unable to pay £5 left me with £-8 frequently. Because apparently I was allowed an overdraft if they did it to me.
When I was doing Amazon Turk - had like $10 to my name, I accidentally clicked on “withdraw funds” instead of “deposit funds” for the $15 I’d spent ten hours earning.
Bank of America charged me $35 for the “overdraft.”
Here’s my “Fuck BofA” story. A long time ago now, I was really tight on cash on a Friday and needed a few things before my next paycheck on Wednesday. I knew how much money I had in my account, and knew what I could afford, and what I couldn’t afford. I couldn’t afford the gas for my car if I bought my groceries and paid a few other bills, which meant that I would just overdraft the card for the gas. I’d be about $10 short of filling up the tank, so I was okay with paying the $35 overdraft fee for the gas, because I needed it to get to work. I did the math, and I’d be roughly -$50 when it was all said and done.
Come Monday, I find that I’m at -$500. I look at my account history, and I see that BofA reorganized all my transactions from the weekend, processing them from largest to smallest. So instead of ONE large purchase overdrafting my account and accruing a single overdraft fee, they hit me with like 6 overdraft fees because of all of the smaller, ~$5 purchases I had made that weekend.
I fought with them for months, telling them that I’d pay the single overdraft fee if they agree to charge me based on the timeline in which I actually made the purchases, but they refused to budge, and eventually closed down the account, and also blacklisted me from opening an account with any major bank again.
The next year, a law was passed that made it so they can’t do that anymore. But the law didn’t make them pay back anybody that they already fucked over.
Disabling overdraft is the first thing people should do when opening a bank account. It’s extremely predatory.
Wells Fargo made a lot of money on ‘Sort Order Optimization’
Say you have $100 in your bank account. You buy a candy bar for $2 from a vending machine, a coke for another $2, fill up $20 worth of gas, and then spend $100 on groceries. You’d think one overdraft charge, for the groceries, right?
Nope. The groceries will be taken out first, then the gas, then the candy bar and coke. Three overdraft charges.
It’s expensive being poor - and they knew that:
“Given our dependence on a small set of OD consumers (4% generate 40% of total OD/NSF revenue),” Zimmerman wrote, “a small change in behavior within this group can cause a large change in revenue.”
That is so fucked up
And is now illegal, thankfully.
For the next couple weeks, I’m sure. The financials are watching all the axes being taken to regulation in the industrial sector and I’m sure they’re gonna want in on that scene at some point.
I stood outside of a BoA one time, charged a bunch of shit on PayPal then went in and emptied/drained my account and someone ate 3500 in charges.
I never got a letter, PayPal said everything was fine. I walked away 20 years ago and never set foot in another BoA. Absolute scum bank.
I used to be a contractor and was sometimes bad at processing timesheets and invoices.
I had one occasion where I had (numbers made up because it was ages ago) £100 in the business bank account with no overdraft facility when a £150 payment went out.
The payment went out putting me overdrawn. They waited a day before deciding that I wasn’t allowed an overdraft and putting the money back.
During that 24 hour period a payment for £25 was processed and blocked because I was overdrawn.
They then charged me two fees for refusing the payments even though I had money for the second one in the bank.
I switched banks right after that.
My landlord charged me $250 for replacement of the original shower head through an “expert” (i used my own and didn’t fasten the hose enough on moving out). 😢
“I have instructed my staff to handle your information request, you have been charged a ‘contact information handling’ fee of 50 dollars”
Verizon…manually go in every month to OK the funds come straight from checking. Been using the same account for over 20 years and it is SAVED on the Verizon site… Have plenty of money in the account, then one month it gets rejected for “account not found”. Bank says they never even tried and i hit re-submit and it goes through no problem. Clearly a problem with Verizon’s payment processing right? But they charge me a $30 “returned” fee and when I reach out to them they wont budge on it.
Verizon one day stopped charging me and canceled my internet out of nowhere. It was coming straight from my checking on auto pay. Then I couldn’t access my account to set it up again and it made it hell to get it back up again. Not sure what was going on
Yeah that checks out. I’ve found out about this in a doubly infuriating scenario.
I was home abroad on a holiday, and they billed me for my regular monthly service. So naturally, i got slapped with the 25$ rejection fee, and then my bank decided to pay the overdraft on the second attempt, resulting in another 45$ in bank fees for that too.
Everything in the US is purposefully designed to fuck you over.
You have to opt in to overdraft protection and fees. Its not designed to fuck you over. You literally signed up for the service and can cancel it at any time.
Edit: Opt-in requirement is specifically only for ATM transactions and one-time debit card transactions. It would not apply to a monthly transaction as described above. Read my post further down for full details.
That is not necessarily true. I opened a savings account recently and their terms were basically “We normally reject transactions that would cause an overdraft but we may choose not to at our sole discretion and if we do pay it you will owe us”
TL;DR:
- If it’s an ATM or one-time debit card transaction, you have to opt-in for them to charge you a fee
- If you didn’t opt-in, they are still allowed to cover the overdraft if they want to by taking from other accounts you have with them, they just can’t charge you an extra fee for doing so.
- If the overdraft is due to a preauthorized/recurring debit card transaction, a check, ACH, or other transaction not covered by 17(b)(1), your consent doesn’t matter, they get to charge you a fee.
Please look at the wording of 17(b)(1), emphasis mine:
Except as provided under paragraph © of this section, a financial institution holding a consumer’s account shall not assess a fee or charge on a consumer’s account for paying an ATM or one-time debit card transaction pursuant to the institution’s overdraft service, unless the institution:
The opt-in requirement is ONLY for ATM and one-time debit card transactions. For a preauthorized or recurring transaction like dinckelman was discussing, that does not apply.
Also some relevant sections of the official interpretation of 17(b):
- No affirmative consent. A financial institution may pay overdrafts for ATM and one-time debit card transactions even if a consumer has not affirmatively consented or opted in to the institution’s overdraft service. If the institution pays such an overdraft without the consumer’s affirmative consent, however, it may not impose a fee or charge for doing so. These provisions do not limit the institution’s ability to debit the consumer’s account for the amount overdrawn if the institution is permitted to do so under applicable law.
- Outstanding Negative Balance. If a fee or charge is based on the amount of the outstanding negative balance, an institution is prohibited from assessing any such fee if the negative balance is solely attributable to an ATM or one-time debit card transaction, unless the consumer has opted into the institution’s overdraft service for ATM or one-time debit card transactions. However, the rule does not prohibit an institution from assessing such a fee if the negative balance is attributable in whole or in part to a check, ACH, or other type of transaction not subject to the prohibition on assessing overdraft fees in § 1005.17(b)(1).
Its true and mandated by law in the US. Before this year, you could file with the CPFB and BBB fairly easily for this type of complaint and get a refund, but who knows if they have teeth anymore.
The BBB isn’t a government agency they’re just a private company that offers ratings similar to Yelp.
You could’ve chosen a different bank.
You could’ve chosen not to victim blame, but yet you did it anyway.
All banks in the US have similar authority, please see my lengthy post under the CFPB link elsewhere in the thread if you are actually here to discuss rather than sling cheap insults
Same for Verizon. Or if your bank account doesn’t have enough funds. Or even if it does, and your bank says the transaction never happened, as long as Verizon says it happened, they charge you a fee.
That’s fucking wild. I have two cards that are occasionally declined because they want to make sure I’m making the transaction. I can afford it but I’d be pissed paying a fee because my credit card company suspected I might not be the one wanting to upgrade to a second phone or whatever.
They blacklisted my bank account and wouldn’t allow me to add another. So I paid off my devices and switched to Mint mobile. I’m saving $150 a month. And my coverage is better.
I’m decades old. The lesson I learned over decades is to NEVER sign up for autopay. NEVER. THERE’S NOT A COMPANY OUT THERE THAT BUGS YOU FOR AUTO PAY THAT WON’T ABUSE YOU.
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Just spend the ten minutes once a month to pay from your bank using the payment service.
“Just”
Thanks I’m curedIt is non-trivial to set a reliable reminder for some, and not due to laziness, just how brains are wired. Set a calendar reminder, you start ignoring it after a few months. Start an alarm, you start snoozing it early. Put a note on the fridge, it eventually becomes invisible. Not impossible to overcome, but also, as I started, non-trivial to solve.
Bill pay pushed from your bank account is okay – you can get even set up limits where it’ll cancel the payment if a bill is unexpectedly large.
Letting creditors pull from your bank account is what isn’t okay.
I really like SEPA mandates for this. Yes, they’re pull, but you can cancel them with one click within 52 days, and the money is back in your account in a few hours (if not instantly).
Most companies that use it are very clear, since auto-pay by law needs a reminder or the refund is an automatic legal cancellation of the contract. (Of course, this is sometimes disguised as an upsell, mostly by telco’s or “disruptive startups”).
And they work across Europe, so my German cloud provider can use debits to pull the money from my Durch bank account.
The US not having such a consumer friendly system is really unfortunate, but not surprising.
The US not having such a consumer friendly system is really unfortunate, but not surprising.
Well, they’re consumer friendly, so of course the US won’t have them.
Yeah, this is a hard lesson everyone should take to heart.
Edit: to add, most banks will allow you to set up automatic payments to go out to companies. This is a far better method because it doesn’t put your finances in the hands of an unscrupulous corporation. (Well, other than your bank but those are the dice we roll)
That text looks like a scam
TWN did that to me too. My card expired and I called to give them the new number. They ran it without the new expiration date because the numbers were identical.
