Know anything about banks & overdrawing accounts?

One of my roomates has an account with Chase bank, and in the past when we have had emergencies, they have allowed her to overdraw her account up to negative $1500 or more. Well, right now her account is only negative $336 (after her car payment was taken out. it was at a little over zero before that.) and it won't let her overdraw it at all. The way she does it, is she goes to Fred Meyer or Safeway, buys something small, and then gets about $100 cash back. She is too embarassed to call the bank and ask because they are usually rude if your account is low, so I thought I would see if anyone here knows how banks work.

How did her car payment get taken out, but she can't get any money out? As long as she pays the overdraft fees, like she always has, I don't see what the probkem is. Here is some additional information if it helps: She just got paid by direct deposit this last Thursday. At that time, her account was overdrawn, but her paycheck brought it into the positive. Is there some kind of monthly limit to how much you can overdraw it? So will she have to wait until the 1st of the month before she can overdraw anymore? Does anybody know any loopholes to make it work? Like if she writes me a check, would I be able to cash it anywhere? Or what if someone else writes her a check for $536, can she go to the atm and deposit it, making her account technically $200 in the positive, then draw out $200 from the atm?

We need the money to pay back a personal loan to a friend, and we Always keep our word when it comes to loans. We always pay it back no matter what it takes. That's why people trust us enough to loan us money. I'll be trying to sell my mini fridge or my samurai sword tomorrow if we can't figure this out, or even panhandle on the streets if thats what it takes to keep my word.

By the way, craigist doesnt allow weapons, as I noticed last time we were in a financial bind. Does anybody know a good way to sell a sword?

I apologise in advance for bothering you about this personal matter. I'm just confused about why the car payment came out fine, which we are glad it did, but still why can't she dip into her own account but the car company can? Banks are confusing.

a reply to: 3n19m470

I know times are tough, but quit ALL spending except absolute necessaties until you are back in the positive. Overdraft fees are expensive and when you get rid of those, times will get a bit easier.

a reply to: 3n19m470

I understand where you're coming from. Before people come in lecturing you, I'll say this: dealing with overdrafts is very risky. They have no obligation whatsoever to let your friend keep dipping into the negative.

And depending on that specific bank's policies, they may even have policies that change how long you can be in the negative. As in, 3 months in the red before shutting down your account or 3 incidences per quarter before new policies & restrictions come into play. And they may change these rules at any time. Because basically your friend is using that account for short term payday loans & the bank is fully aware of this. Though that doesn't mean they're against it. They'll just change the terms so it's more favorable to their operations. And if it's not a good option for them, they'll just put a stop to it when they feel like it.

As for the sword, I'd first check if there are any local stores that carry them. I'm not sure if local newspapers will let you put out classified ads for them but it's worth looking into.

[Disclaimer: I'm not in banking so someone else may be able to give you much better advice]

The bank has no obligation to allow you to overdraft your account. Most banks being what they are will allow a few as a courtesy because everyone makes mistakes from time to time. Overdraft fees are fairly high to discourage overdrafts in the manner you have described. What it sounds like is the bank felt your roommate abused the courtesy and the bank is refusing to allow her to overdraft.

And yes if you can get the account back in the positive it should allow you to get the money out.

a reply to: 3n19m470

I expect in the future bank machines will take blood directly as payment.


As far as hawking the sword go to an army surplus store, pawn shop or antique store.

My account has an overdraft of 2500, it all depends how your account was set up, i had to call to my bank and depending how much money i made per month, they offered me the 2500 over.

Overdrafting is alot cheaper than credit card payments.

originally posted by: dukeofjive696969


Overdrafting is alot cheaper than credit card payments.

Depends on if it's one once in a great while, or several time per month or more.

I better add that I DON'T do overdtafts, I DON'T do credit cards. When the money is gone, it's gone.

a reply to: 3n19m470

TMI

Banks are confusing.

Not as much as this thread was!

Here is a thought....try only spending what is available!

Thanks everyone for the replies so far
It seems to me that if they are making easy money on the overdraft fees, and she has always paid them faithfully, then what else do they care about besides making money? I forgot to mention something like this happened last february too, where she tried to do it and it wouldn't work, and then a couple days later, it worked again. I was just wondering the method to their madness. If I knew how long they are going to make her wait, whether its 2 days or 2 months, or longer, that would help us plan.

And yeah I know we need to quit doing this. It amounts to throwing away money. Worse than gambling even, because you don't even have a chance to win anything back. It's just borrowing money at an extremely high interest rate...

originally posted by: soulpowertothendegree
a reply to: 3n19m470

TMI

Banks are confusing.

Not as much as this thread was!

Here is a thought....try only spending what is available!

And I am happy for you that you could find such a thing confusing. I truly do hope you never find yourself in a situation where you would fully understand this thread. Good for you.

a reply to: 3n19m470
What type of account does she have and does she have overdraft protection (i.e. savings account or credit card linked to checking account)?

I have a set limit on how much I can overdraw. Perhaps her policy changed. It might be ok for automatic payments like her car going through but to try and get $100 cash won't work most likely.

Possibly if her overdraft amount is still set higher like usual, she can write you a check you can cash at one of those places that cash right away. To go into your bank to cash it might require you have those funds in your account already in order to cash the check for immediate money, which you don't appear to have.

Constantly using the overdraft isn't good to do. The interest is high and it looks bad. Had she not abused it, she might have gotten approved for a credit card to help in situations like these. At some point they did give her this credit line. An overdraft coverage is in fact a line of credit but you are expected to pay it on time. Timing might be off on this today when it failed. She actually doesn't sound responsible enough to get a credit card unless she stops abusing it in this manner.

Sorry I can't think of ways to get the quick cash.
Some old lady needs some yard work done, I know that!

You guys are setting yourselves up to be my mom Don't turn into my mom when it comes to money, dear god, don't. She's always been a blind spender rather than a saver, and when I say blind spender, I mean she'd think nothing of putting up with overdrafts for stupid crap like a pack of cigarettes :/ $35 overdrafts add up fast, and even faster if they're compounding ones. I cringe when I think about the total sum of money she's thrown away on overdrafts in the past decade alone. And she never could figure out why she was always broke (gee mom, I wonder why??)

You've got to really get control back, before it spirals out of control. Unless they're sent to collections, overdrafts alone don't impact your credit, but if the bank decides to close your account and the overdraft(s) is sent to collections & you do not pay up, yes, it does. I'm not finger-wagging, I'm speaking from experience trying to fix the crappy banking of my own parent. You'll feel "poor" for a while as you're reigning in your expenses, but you'll be wiser for it. Once you see a surplus building up in the bank instead of in the negative all the time, you're going to start wondering how you never did it before.

originally posted by: 3n19m470
One of my roomates has an account with Chase bank, and in the past when we have had emergencies, they have allowed her to overdraw her account up to negative $1500 or more. Well, right now her account is only negative $336 (after her car payment was taken out. it was at a little over zero before that.) and it won't let her overdraw it at all. The way she does it, is she goes to Fred Meyer or Safeway, buys something small, and then gets about $100 cash back. She is too embarassed to call the bank and ask because they are usually rude if your account is low, so I thought I would see if anyone here knows how banks work.

How did her car payment get taken out, but she can't get any money out? As long as she pays the overdraft fees, like she always has, I don't see what the probkem is. Here is some additional information if it helps: She just got paid by direct deposit this last Thursday. At that time, her account was overdrawn, but her paycheck brought it into the positive. Is there some kind of monthly limit to how much you can overdraw it? So will she have to wait until the 1st of the month before she can overdraw anymore? Does anybody know any loopholes to make it work? Like if she writes me a check, would I be able to cash it anywhere? Or what if someone else writes her a check for $536, can she go to the atm and deposit it, making her account technically $200 in the positive, then draw out $200 from the atm?

We need the money to pay back a personal loan to a friend, and we Always keep our word when it comes to loans. We always pay it back no matter what it takes. That's why people trust us enough to loan us money. I'll be trying to sell my mini fridge or my samurai sword tomorrow if we can't figure this out, or even panhandle on the streets if thats what it takes to keep my word.


By the way, craigist doesnt allow weapons, as I noticed last time we were in a financial bind. Does anybody know a good way to sell a sword?

I apologise in advance for bothering you about this personal matter. I'm just confused about why the car payment came out fine, which we are glad it did, but still why can't she dip into her own account but the car company can? Banks are confusing.

First, one thing to clear up, if the car payment comes out automatically, whether you have $300 or $0, it comes out. So if your car payment is say $100, you will have hypothetically in this scenario, $200 left over if you started off with $300, or you will have negative $100. Either way, automatic payment comes out regardless of how much you have in your account. That's why with Online Bill Pay, I have it set to NO for automatic, that way I don't go in the red. Just remember on payday to pay that bill as soon as your check go through.

Also, as Tinker said, also, Overdraft fees are a BEEYOTCH!! $35, then 5 days later $7 a day on TOP of the $35 and that's until you give them enough money to put you in the black! That's ridiculous! WHY are you letting them take that much of your money??? Have you lost your mind? My bank if you have money in your savings account, if you want that is, they'll take the money out of savings, rather than overdraft you, and if you don't have it in savings, you're card will come up declined. Banks used to charge a $35 charge a year for this. Now they charge a $6 once per use fee.

I would highly, highly, HIGHLY recommend the stopping of the overdraft fees. You'll find you have a LOT more money to play with when you do. I would suggest selling the sword through the local paper or pawn shop, but you might not get a good price for it. Considering the bind you guys have placed yourselves in, (I know, my ex has placed me in it in the past, bouncing my account TWICE for one pack of cigarettes. *eye roll* $80 pack of cigarettes. I hope he damn well enjoyed that pack, it's the most expensive pack he ever smoked. I told him do not use the card, we don't have the money, what's he do, takes the card out of my purse and buys a pack of Marlboro for $10. Argh!), options are limited.

originally posted by: tinker9917

originally posted by: dukeofjive696969


Overdrafting is alot cheaper than credit card payments.

Depends on if it's one once in a great while, or several time per month or more.

I better add that I DON'T do overdtafts, I DON'T do credit cards. When the money is gone, it's gone.

My bank, when I set the account up, you can set the option to allow overdrafts, or have the card declined, or allow the money to be pulled from your savings account for a one time $6 fee, ONLY if the money is there. If it is not there, the card will be declined. Also, on Online Bill-Pay, if ANY Bill is set to Automatic, say Electric, Car Insurance, etc..., if you do NOT have the funds in your account, a lot of people do not realize Automatic means just that, Automatic and the bank will pull the funds whether it is in your account or not and this can cause your account to go into overdraft, EVEN if you have your account to set to NO Overdrafts. When I set my new account up and a new bank today, we were talking about how a lot of people don't realize this. I have 4 online bills I pay and NONE I set to Automatic because a few years ago I had it set to have it paid by me, then the company changed it to Automatic and Overdrafted my account by accident. Huge mess! I got it fixed, and it's never happened again, but to this day, not a single bill is automatic, even if it means lowering the cost by a few dollars.

originally posted by: 3n19m470
Thanks everyone for the replies so far

It seems to me that if they are making easy money on the overdraft fees, and she has always paid them faithfully, then what else do they care about besides making money? I forgot to mention something like this happened last february too, where she tried to do it and it wouldn't work, and then a couple days later, it worked again. I was just wondering the method to their madness. If I knew how long they are going to make her wait, whether its 2 days or 2 months, or longer, that would help us plan.

And yeah I know we need to quit doing this. It amounts to throwing away money. Worse than gambling even, because you don't even have a chance to win anything back. It's just borrowing money at an extremely high interest rate...

You want a high interest rate, try a payday loan, then you're talking high. Those suckers are close to 700%!!! My ex got suckered into those when he was in the military. You'll find them near every damn base!

originally posted by: AllSourceIntel
a reply to: 3n19m470
What type of account does she have and does she have overdraft protection (i.e. savings account or credit card linked to checking account)?

I believe it is a checking account, with a debit card linked. But not a credit card. I don't know about overdraft protection. I don't know what that is.

a reply to: violet

Thanks. I know, we are really trying, but as I said, I will do anything it takes to pay back a personal loan. Because someone trusted me. I don't care if I end up paying double the amount as a result, its important to me to maintain my reputation as someone who Always keeps their word. And I actually do have my own start up business doing "yard work for old ladies" type jobs, since I have extensive experience in home repairs, maintanance & yard work, and since I have to be nearby to my fiance due to her medical conditions.

So I do work around the neighborhood or sometimes a little further away. It certainly helps! But unfortunately, I don't have any work to do right at the moment. I have a gentleman I'm supposed to talk to Monday or Tuesday. But I need to pay off my debt tomorrow in order to keep my word. Which I will do, because I always find a way. That's why people trust me.

originally posted by: 3n19m470

originally posted by: AllSourceIntel
a reply to: 3n19m470
What type of account does she have and does she have overdraft protection (i.e. savings account or credit card linked to checking account)?

I believe it is a checking account, with a debit card linked. But not a credit card. I don't know about overdraft protection. I don't know what that is.

Over draft protection works two ways. One is a credit account and the other is having your checking account linked to your savings account. As to the loan, if things are that tight just tell them you need a few more days. Most people understand that things happen. I get that you see it as a keeping your word thing, but the truth is none of that really matters because when you open your checking account it is in your agreement with the bank that you will not overdraft your account.