Bank accounts, insufficient funds, and bank charges!@#$%^&*

not enough funds on account - insufficient funds on account
@bounce58 (17552)
Canada
November 4, 2011 4:59pm CST
I've been kicking myself this past couple of days. Due to a gross error on my part and a bank procedure, I've cost myself some bank charges. Because banks normally debit all negative transactions first, before they credit deposits, I've been charged $40 for having insufficient funds in my accout. I don't know if this is done by a machine, or a computer program, but it seems silly. Because when it processed my incoming, it had more than enough money in the account. Maybe if it were done by a person, he or she would see that there was no need for the 'insufficient fund' charge. And to add insult to injury, the company which I issued the check to also charged me $25 for having not enough funds on the account! I should rename myself to dunce58! Have you ever been in this situation? Don't you think that if a real person was processing bank accounts and sees this situation, there wouldn't be a need for a charge? Or do you think this is just one of the many ways bank milk us for our hard earned money?
3 people like this
8 responses
@katsmeow1213 (24638)
• United States
5 Nov 11
Aw, that sucks! If I were you I'd go talk to the bank manager, and make a little bit of a stink about how you had enough money.. but of course the deposit went through last so it overdrew you. They might be nice and reverse the NSF fees for you. Most banks can. I know my bank (the one I use, not the one I work for)seems to process things between 11am and noon everyday. Anytime a check clears my account, that's the time it's going to clear. Direct deposits clear automatically though as soon as they're posted. My husband's DD clears into our account at 5am Friday mornings, that's what time his bank releases the funds. If the funds into your account was a check that had a hold on it, that would obviously delay the availability of the funds and cause and overdraw. I think the release of those funds is all electronic, actual people don't handle that sort of stuff. I can't really say anything more than that. I know how to process the transactions, but I know very little about what goes on behind the scenes. At the end of the day we send all our paper work to a proofing center who double checks it and then sends it on to the Federal Reserve. Checks drawn on other banks get sent to their processing centers where they then get around to releasing the funds. That's the extent of my knowledge of the behind the scenes action. Have I been in this situation? Yes.. many many many many times. Until this year we practically lived on our over-draft protection from our bank. Most of the time they would cover overdrafts, but of course I'd have the $34 fees from the bank. In order to pay our bills and buy food and cover everything else we needed we'd usually purposely overdraw our account. Since hubby's check was direct deposited every week we could cover the overdrafts fees.. but that would leave us short the following week so we'd need to overdraw again.. and it became a crazy snowball effect. Hubby was so mad that everytime he got a bonus.. where we should have like $1,000 in our account, we only had the amount of a typical paycheck because of all the NSF fees we'd accrued ate up his bonus. So the depression would lead us to do something stupid like go out to eat at Red Lobster with all the kids.. which left us short on bill money, which caused us to overdraw again. We've been so much better this year. Our account has not been overdrawn since January 25 of this year. We haven't exactly been perfect. There've been times we've written checks on Thursday knowing the funds aren't in the account, but the check wouldn't be cashed till Friday so we'd know we were okay. Or there was a debit out there somewhere that wasn't posting yet, so we'd use those funds and basically float till Friday. Thankfully the debit didn't go through and overdraw us. But we have gotten a lot smarter. I've been keeping much better track of our account balance, and I've yelled at hubby 100 times about him checking our online balance instead of asking me what is our actual balance. He's better at asking me before he spends money because he's finally understanding that there are checks floating around out there so he can't trust our online balance. And I've gotten better at saying no to tempting things like going out to eat when I know we don't have the funds, or we have bills looming. Having the extra cash from my job has helped tremendously too. That little bit extra every week has given us pretty much exactly what we need to get by and sometimes have a little bit of fun. Only trouble is that little bit extra still isn't enough for me! Why does it seem like no matter how hard you try, you can never earn enough money for everything you want?
1 person likes this
@bounce58 (17552)
• Canada
8 Nov 11
I just made a commen on the previous discussion that she sounded like she works for the banking industry. It's amazing, that you sound even better than her, considering that it's just been a short while that you worked at BoA! I've actually been better at keeping track of my floating checks as I have a spreadsheet that I regularly update to let me better track my finances. I just slipped up this time! That's why it's been hard on me. You are actually one of the better stories that I read about here on myLot kat! I like that your future is a little bit brighter. Why does it seem like no matter how hard you try, you can never earn enough money for everything you want? -That's just human nature, we can never really get satisfied with what we have.
• United States
8 Nov 11
I saw that comment. I learned some of that stuff in math class, about having daily balances and all that stuff.. and I really don't understand it too well. Math is not my strong suit. They say you learn from your mistakes, so hopefully you learned from this one. Don't you keep a register (or ledger some people call them) in your checkbook? Mine is on me at all times. I use my debit card a lot, so sometimes it takes me awhile to get around to adding each tiny little debit, like if I used my card at the gas station for a soda.. but I always try to sit down and balance the checkbook when I know I've spent some money. I hope you use online banking also. That way you can go to your bank's website and see your balance and what transactions have posted and compair them to your ledger. I always put a check mark in the ledger of things that have gone through, so if my balance is different than what the online statement says, I can go back and see if there are checks that haven't cleared yet or whatever. You should also look and see if your bank offers overdraft protection. The bank I use allows overdrafts up to $200.. they automatically cover it, but charge you an NSF fee.. but at least I escape the fees from bouncing a check. The bank where I work allows overdrafts by automatically withdrawing funds from your savings account to cover debits to your checking account. I am not sure if there is a fee for this, but there probably is. But again, at least you'd escape the $25 bounced check fee.
@bounce58 (17552)
• Canada
8 Nov 11
Thanks for the tip! I think I should call in about an overdraft protection. I've been with this bank for a long time, and because I normally have no issues with them, I never bother calling or communicating with them. Maybe there is that option, and I just have to ask. I know that in my other banks (suprise! I use multiple banks!), they've offered me overdraft protection.
@dorannmwin (36611)
• United States
8 Nov 11
I dunno about renaming yourself because in this situation, bounce works as well. LOL. Okay, our bank I guess is one of the good banks because when they process all transactions at the end of the day, they will credit the deposits before they will process the debits from the account and they also process the transactions from the smallest amount to the largest amount to keep minimize the possiblity of overdraft charges. In the nine years that we've been with that bank, there has only been one time that we've been charged with an overdraft fee.
1 person likes this
@bounce58 (17552)
• Canada
10 Nov 11
You are so right about the 'bounce'! Hey! What is this bank that you're with? I think that is really good if they choose to do their transactions that way. I wonder why most banks don't do it that way. I think that shows how well they value their clients/customers. Thanks.
@dorannmwin (36611)
• United States
10 Nov 11
Our bank is United Bank of Kentucky (that's where we live). It is a small local bank that only has branches in the central Kentucky region. What I might suggest that you do is look around at regional banks in your area and see if there are any banks that have similar procedures.
@skysuccess (8884)
• Singapore
6 Nov 11
bounce58, I believe you can actually call the bank manager or someone at the overdraft department to have your situation redressed and waived the insufficient fund fees on both sides. Banks nowadays do not take likely when at clearance finds that you lack the balance for reconciliation. It is just standard procedure and practice. In your case, there are some time differences between the timings for clearance and reconciliation. You just need to be wary of it and call your creditor to present your check one day later. With the available tools like internet banking and phone banking to make use of, it is really on you to avoid such a charge. Since this is an exceptional case, I am quite sure your bank could grant you a waiver but would be subjected to certain legitimate reasons like your good standing with the bank or the first time for this incident. I am really careful with my check payments and even though I have an overdraft facility for my current account, I have never actually used it till today. So, do be careful in the future and you may consider applying an overdraft facility for your account to avoid another fiasco like this one.
@bounce58 (17552)
• Canada
10 Nov 11
I have actually been very wary of these time difference between the timings of clearance and reconciliation. It's just that I slipped up this one time. And I can't help but think that if it were a person doing the reconciliation, then my track record of not slipping up might have come into consideration. I guess I just live and learn. Thanks.
• Singapore
13 Nov 11
bounce58, I suppose you can always call the bank manager up to help waive or refund that admin fee, no harm giving a try since many have done with reasonable success when it is an isolated case like yours. Nothing ventured, nothing gained. So, you may want to consider it and add a learning curve that might just work to your advantage.
• United States
5 Nov 11
I think it's just an excuse for banks to make extra money off peoples' silly mistakes. I get charged a lot for having insufficient funds. I have a savings and checking account with bank of america and I only keep a little bit in the checking account at a time and the savings is just money that I got back from school from my scholarship. I always forget to monitor how much I have in there and what the minimum required balance is. Apparently it's 25 dollars and when my account goes below that I get charged. Now, banks are even starting to charge a monthly fee for having and using a debit card, which I think is ridiculous. Then, at a different bank where I keep my actual savings account I can go in with coins and have them turned into cash for free. Well, I went in today to do it and now they're charging a fee for that too. All these fees are getting annoying and it's making me start to dislike banks.
• Australia
5 Nov 11
Hi courtknee, I just tried to explain about bank charges. Bank has computed your account balance according to your ADB (Account Daily Balance) where computation of this is based on your account's movement for the whole month. Example of this is, if the bank's maintaining balance is $50 and you withdraw $10 on the 20th day of the month your account daily balance already affected by your bank activity so at the end of the month if you did not meet your maintaining balance, your ADB is already affected so the bank charged you below maintaining balance. I don't know what really the problem with your account I just gave and show you example of how banks charged your account. Have a nice day!
@bounce58 (17552)
• Canada
8 Nov 11
I think it was last week when the CEO(?) of Chase was in Seattle. And the people of the Occupy Movement were just voicing out their grievances against the bank executive because of these such charges courtknee. Thanks for the explanation gelayagui98. You sound like you work in the banking industry?!
• United States
8 Nov 11
Actually Bank of America has reversed their decision to charge a Debit Card fee. But honestly these fees aren't just to make the bank money. Nobody is getting rich off of your silly mistakes. First there are products available to help you avoid such silly mistakes like online banking which allows you to check your account balance (and you really can't blame the bank if you forget to keep track of your own spending). Bank of America also allows you to link your checking and savings accounts so that if you do overdraw, they will take the funds from your savings and transfer them to your checking to avoid the overdraft (or you could do this yourself using online banking). Those fees that you are charged for your balance being too low or for overdrawing goes to cover the bank's expenses. Banking is a service, just like your internet provider. You can't expect it to be completely free. Banks have bills to pay same as you and me. They have employees to pay and taxes etc.
@gelayagui98 (1339)
• Australia
5 Nov 11
Hi bounce, Sometimes the caused of this is, due to system error. Please do not be offended because most common problem of such case is, funds was deposited late. Bank has cut-off time for inward and outward checks. They imposed bank penalty for this stamped your personal check "Insufficient Fund", your maintaining bank charged you same with the depository bank where your client deposited your check. If ever this was bank error/mistake, you can make a complain to your depository bank by written or verbal complain in order for them to review status of your account and if found it was their mistake, the charges debited to your account will be credited back as it is. There's no milky bank transaction because all transactions were supported by documents.
@bounce58 (17552)
• Canada
9 Nov 11
Hello gelayagui98. Actually, I've known about this cutoff time before. I've known that debits are charged first before the checks coming in. It was just a miscalculation on my part. Thanks for the response.
1 person likes this
• Australia
9 Nov 11
You are welcome anytime my friend. At least I applied once in a while my banking knowledge, I was once a bank employee for a decade now turned "all around nanny of my kids", I handled check clearing operations for some times. It's my pleasure to share you my know-how in banking industry. God bless!
@SomeCowgirl (32277)
• United States
5 Nov 11
*moo* Does that answer your question? The real question is, even if a human was doing it? would they process the credit first, or let the debit go through?? banks get more money, they get more money.. ?
• United States
8 Nov 11
I don't honestly believe that banks are out to "get" people in that way. In my training all that has been drilled into my head is how we are there to help the customers with their finances. We aren't out to try to get more of their money, we're there to offer them products and services that fit their lives, and if possible find ways to make them more money with accounts that offer higher interest rates, etc. I highly doubt a bank employee would purposely overdraw a customer's account to earn the bank more money, especially since raises aren't based on how much money you earn for the bank, they're based on how well you do your job.
@bounce58 (17552)
• Canada
8 Nov 11
This is a great example of looking at both side of the fence. On one hand, as consumers, me and SCG only see the banks as out there to get us. And charge us money. While on the other side, you kat have the perfect view on how it should be. On how people should be more responsible with their finances. Thanks you two!
@sona22 (1434)
• India
5 Nov 11
I have never faced such incidents. I always keep sufficient balance in my bank account. However I have some information about realizing charges by the bank for this type of incidents. As you mention that banks normally debit all negative transactions first and then credits deposits is not true. Banks debits or credits as first come first serve basis. If they debited your instruments first, obviously it was present first and that time your account was insufficient balance. Your deposits came later.
@bounce58 (17552)
• Canada
9 Nov 11
Hello sona22. I actually transferred the funds earlier in the day. But since they require some time to post the transfer, which means later in the night, they processed the incoming checks first. Thus, the fine. Thanks.
@kingparker (9700)
• United States
5 Nov 11
Anyway, banks are commercial institutions, and they will try every single way to rip us off from anyway they see fit. So, what is the real story behind all this? I just got a bit confused after reading your post. So, you got insufficient fund in your account, which mean you use your checking account done some shopping lately, and you don't have enough money to pay for it from your account? And also, the place you write a check to, they bounced the check and they charged you for it? It seems logical, if you already knew you don't have enough money.
@bounce58 (17552)
• Canada
9 Nov 11
I actually issue checks at the start of the year, which would be debited from my account at the first of the month. To cover this, I transfer funds from my savings once in a while. Although I transferred the funds early in the day, they don't actually post it until sometime in the night. And since they processed the incoming checks first, I got the 'insufficient funds' first, before the funds came in. By then I was already charged.