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Across the Fence:  Is this even legal?  |
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prariehawk
True Blue Farmgirl
2914 Posts
Cindy
2914 Posts |
 Posted - Oct 17 2012 : 4:19:03 PM
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I belong to a credit union that I've been doing business with for years. I have overdraft protection, which I pay a fee for if something is over. Lately, they've been charging me an overdraft fee on transactions that are pending. I've already decided to take my business elsewhere. I just wonder if this is legal.
Cindy
"Vast floods can't quench love, no matter what love did/ Rivers can't drown love, no matter where love's hid"--Sinead O'Connor
"In many ways, you don't just live in the country, it lives inside you"--Ellen Eilers
Visit my blog at http://www.farmerinthebelle.blogspot.com/ |
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Alee
True Blue Farmgirl
22941 Posts
Alee
Worland
Wy
USA
22941 Posts |
Posted - Oct 17 2012 : 6:25:14 PM
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Yes, especially if you have debit card authorizations that are pending. It follows the Federal Regulation E which governs electronic movement of funds. Basically, Debit card authorizations are guaranteed if the bank gives the authorization (you had money at the time you swiped your card) however, some merchants might only pend for $1 (gas stations primarily though others do as well) and some small merchants don't like to close their credit/debit card batch (request the final payment of the money from the authorization) because their card processor charges a fee each time they do. Also the debit card authorizations are good for a complete 6 months! So if you swipe your card or authorize your card, but the merchant does not close the batch for a few days, banks are allowed to "Freeze" or hold on to the authorized amount off your card for 3 buisness days since they have to pay out that money to the merchant- regardless of whether the money is in the account when the batch is closed or not.
Alee
Farmgirl Sister #8
www.farmgirlalee.blogspot.com
www.allergyjourneys.blogspot.com
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Alee
True Blue Farmgirl
22941 Posts
Alee
Worland
Wy
USA
22941 Posts |
Posted - Oct 17 2012 : 6:29:25 PM
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I work at a bank, and what I see happen alot is something like this:
$20 in the bank,
Person decides to get some gas. The card is authorized and pending for $1 but the real price that will come through when the batch is closed is $20.
Person realized they are short on groceries so spends $10 on groceries to get them buy. The groceries post fairly quickly. When the gas comes through in 3-5 days, then they forgot about the monthly gym membership of $40. So they overdraft and get a fee and then the gas comes through and now they have to make up the difference.
OR a pending payment holds the funds, so say there is a pending amount of debit card transactions for $20, but then a $10 check for something comes through...technically the funds are in the account, but they are on hold for the debit card transactions, so you are "overdrawn" and get a fee.
It stinks but is all legal and all banks have to do it this way due to Federal Regulations. :( I am so sorry that it has happened to you, though.
Alee
Farmgirl Sister #8
www.farmgirlalee.blogspot.com
www.allergyjourneys.blogspot.com
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prariehawk
True Blue Farmgirl
2914 Posts
Cindy
2914 Posts |
Posted - Oct 17 2012 : 7:32:00 PM
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Thanks, Alee--I have a debit card but I always run it as a credit card. Would that make any difference? Also, I sent a check to the water company and it posted (according to the water co.) on Monday. What the credit union is telling me is that the check still hadn't cleared by Tuesday at 5:00 pm. That just doesn't seem right. They knew I had the funds (and more than enough) to cover the check, so why did they wait so long to clear it? I didn't use the card till after 5:00 on Tuesday; I thought the check should have cleared by then.They just recently started doing this; it's never been an issue before. something about this seems very fishy.
Cindy
"Vast floods can't quench love, no matter what love did/ Rivers can't drown love, no matter where love's hid"--Sinead O'Connor
"In many ways, you don't just live in the country, it lives inside you"--Ellen Eilers
Visit my blog at http://www.farmerinthebelle.blogspot.com/ |
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Alee
True Blue Farmgirl
22941 Posts
Alee
Worland
Wy
USA
22941 Posts |
Posted - Oct 18 2012 : 05:25:47 AM
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No, it doesn't matter if you use it as a debit or a credit. The water company and their bank may see it post before it actually clears the maker's bank depending on agreements their bank has with the Fed. Usually, when you make a deposit especially a buisness- as long as they have not had a return item from the maker, the check will "post" to their accounts immediatly- meaning they get the credit. But the check still has to be processed by that bank, sent through the Federal Reserve Bank to get to the maker bank. This can take 2-3 days though with electronic imaging it is speeding up a little.
So never go off what the reciever says when the check posted. Even if they got the credit from their bank- that is a "soft" credit that can be reversed for up to 45 days (which happens if the check bounces). You have to go off when your bank recieves the check and processes it against the account. Also check the posting order for your bank. Most banks do the following regardless of the time of day in which the transaction happened: Credits first, Pending Debit card transactions (prior and current day), followed by paper and ach debits. So even if the check was clearing on the same day as your credit/debit card purchase was authorized- the debit authorization off your card would have had more precedence over the paper item.
Alee
Farmgirl Sister #8
www.farmgirlalee.blogspot.com
www.allergyjourneys.blogspot.com
[url=http://www.TickerFactory.com/weight-loss/wff7Xpc/]
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Edited by - Alee on Oct 18 2012 05:26:52 AM |
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Across the Fence: Is this even legal? |
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Is this even legal?
