Banks Are Trying To Pull A Fast One!
I’m sure we’ve all had this happen: you purchase a couple of things on your debit card, but you know your balance is a little lower than usual. When you check your bank account, you see that the transaction is pending and it has been removed from your available balance that you can use. That’s great! It’s better to know how much you have left than not. The problem, however, comes when that pending transaction is removed from your account pending finalization. That 1 or 2 days (often on a non-banking day like Sunday) can falsely indicate that you have more money than you actually do. So, in the rush of life, you look at your account again the next day and you’re like, “OK, I have enough to buy X item.” WRONG. And of course, the obvious happens next: all of the transactions get finalized and you get hit with a nice fat overdraft fee.
This is the practice that I deplore.
In this economy, when so many people are living paycheck to paycheck and are trying to scrounge every penny to get the things they need, it is a false premise that banks operate on when transactions are removed from the available balance. What I don’t understand is why the debit from the account remains pending until the transaction is definitively finalized. Some other countries do this (finalize the settlement of a debit), so it has to be something with US-based banks that they manipulate how this happens. Think of all the overdraft fees that they get every year for this same circumstance. Are they really going to endanger their cash cow? I think not.
The same holds true for the new legislation regarding credit card companies and their inability to make changes to fixed rates. So what do they do? Make all credit card rates variable and market dependent (it depends on the prime rate now i.e, what they use to determine your mortgage rate if you own a house). And who runs the market for these areas…. drumroll please! The credit card companies!! Wild guess!! I got a notice that my sole credit card is going to a variable rate of 24.99% — and if you don’t want the rate, your agreement will be cancelled and so will your credit line. O_o Right.
Let’s think about this a moment: lots of people these days don’t qualify for new credit. Pushing them against a wall and saying we’re raising your rates is just basically saying “Screw you! I know you can’t get new credit, and you need the credit you have with US, so how about you just sit down on the pogo stick and shut the f**k up?” Isn’t that what they’re saying?
Unfortunately, the only real way out of this is to improve one’s credit so that you don’t have to live with the dictates of the bank. Another option is just to save save save. But there comes a point where the banks and credit card companies have to get right with the American public. I would love to see Americans have enough in their bank accounts where they could screw the credit card companies. The whole, “Get the credit and only use it once a year, then pay it off in full” is the worst kind of customer a credit card company wants. No fees, no overages… they make no money on you… and there are a LOT of customers that are like that! They’re “good” customers, paying off their cards on time, no real major balances — but they too get screwed with rates and inactivity policies that have the credit card companies closing their credit lines. All because they’re not making money on them! Still, companies are are relying on the human nature (maybe it’s more American nature) of always wanting more to be at work.
I hope the credit card and banking industries get their comeuppance!! Fight back, Americans! Don’t give in to their foolishness. We need to return to a more conservationist mode when it comes to our money. Save more, spend only on stuff you need. Keep your balances as high as humanly possible so that you’re not giving away valuable money to the bank. And legislators, you have your work cut out for you. The credit card law that passed took 18 MONTHS to take effect! Why did it take that long? The credit card companies said it would take a while for them to modify their setup so that their revenue stream wasn’t affected. Bull. They wanted the time to come up with another way to bamboozle their customers into coughing up more fees. I have no sympathy for their industry, especially when people are out of work, often through no fault of their own, and are literally struggling to feed themselves and their families. Most Americans are honest folks — if its a choice between keeping a roof over my family’s head and paying the credit card company their minimum fee, I’m sorry, option 1 it will be. They’re not trying to shirk their responsibilities; they are trying to survive. This is something they don’t seem to understand about the real meaning of hardship.
I’m getting way too hot on this topic… it just upsets me so! I’m done… *shake my head*