Bank of America Raises Fees on Checking Accounts

I recently received a pamphlet about the “improvements” that Bank of America is making on several of their checking accounts. But after reading through it, all I see are a bunch of small fee increases.

For example, many people have the MyAccess checking with no minimum balance requirement and no direct deposit requirement. Now, the monthly fee is either $8.95 or you need a direct deposit. And you can now be dinged by the $35 overdraft fee up to 10 times in one day. I guess they aren’t scared of another class action lawsuit. You can see all the pricing changes outlined here.

I guess they need to drum up some more money somehow, and most of the fees are still avoidable. But given that around 27% of their revenue comes from fees, and that there were $36.7 billion of overdraft charges by banks last year, I really think this is another reason banks are pushing their debit cards so much. Not only do they earn transaction fees, it makes it that much more likely that people rack up more overdraft fees. Imagine this: You lose track of your balance once, but make 5 small purchases over two days before realizing. That’ll be $175, please!

Be careful out there… those “free” checking accounts have to be paid for somehow.

Comments

  1. Ya know … I have a hard time feeling sympathetic for people that get stuck with fees for bouncing checks or not paying bills on time.

    PAY YOUR BILLS ON TIME!
    KEEP TRACK OF HOW MUCH MONEY YOU HAVE!

    It’s called being an adult, folks.

    Take responsibility for your actions and mistakes. These onerous fees are good for society – they teach people that there are consequences for screwing up and not managing your money responsibly.

    These times prove that people can certainly use more of those lessons.

    But when people do screw up, do they take responsibility … no, they blame the evil, profit-greedy banks and credit card companies for unreasonable fees.

    I say, jack up the fees! Make repeated irresponsibility hurt. Teach this fiscally-challenged children a lesson that will help them in the long run.

  2. isnt 35 * 5 = 175 $. Also why would you use a debit card without knowing your balances?

  3. Those bastids! I got the same thing in the mail. I am closing the account out of pure principal. I detest shady practices like this.

  4. Even if you’re being a responsible adult, sooner or later you’ll screw up and be overdrawn. This is why I put everything on my credit card, and pay it off monthly. Then it’s one checking account transaction versus fifty or more. Might as well reduce the odds as much as possible.

  5. Thanks for the notice. I did get mail from banks but never payed enough attention. Going to cancel the account before June. You did a great a job on this blog!!!!

  6. Just use ING to do some ACH push “direct deposits” into BOA checking account. That’s what I’ve been doing for years for on my free checking account with another bank.

  7. CardMerchant says:

    An FYI for those of you thinking of ‘downgrading’ your debit card to a regular ATM card – you won’t be able to withdraw funds from overseas ATMs while traveling. After having my debit card stolen in the mail, a card I had only ever used as an ATM card, I figured I would ask for the standard ATM card instead. It wasn’t until after I received it that I was told that it would no longer work in overseas ATMs.

    I agree with Randy – use credit cards for all purchases and just pay the balance off at the end of the month – debit cards are a trap.

  8. I still don’t understand why people do not all use credit unions. Am I missing something? No fees. Great rates. Very little downside. Why go to a bank whose stated objective is to cause you to part with your money?

    Sorry to name names, but I tried to use Firstmerit for a while. It took them a week to make funds available when I made a deposit. Not only that, but your balances would show money that wasn’t there! I could literally ask for my balance, withdraw money they show there and be charged and overdraft fee! And the fee was $39! Outrageous! And all this because THEY took too long to process my check and couldn’t be bothered to update my balances.

    Banks are a waste of time in my book. Why does anyone use them? (I mean that honestly, maybe I am missing something)

  9. Well, as a bicoastal student (east coast during the school year, california during the summer), using a bank like Bofa is really helpful in terms of using ATM machines, having access to branches, etc.

    Of course, that also means I have a student account, which doesnt have these minimum balance requirements, etc. I guess I’ll have to do some research before my campusedge account switches over to a myaccess acount, because these terms sound pretty awful.

  10. I’m using ING and Pentagon Federal Credit Union. I have no use for big US banks and there high fees, these banks are very close to being criminal organizations.

  11. Do they offer any type of reserve or premiere line that can be used as overdraft protection? If it wasn’t for my USBank reserve line, I’d be in prision by now, because my finances fluctuate alot.

  12. Justjoeguy says:

    I have two My Access Checking accounts at BofA, both require a direct deposit. I use Paypal. A $1 DD will do it. But you shouldn’t use debit cards to pay bills for the most part. Use a credit card. BofA also hasn’t something called Add It Up. Gives 2% back on purchases if you use their debit or credit card.

  13. “Even if you’re being a responsible adult, sooner or later you’ll screw up and be overdrawn.”

    Bull. I’ve never bounced a check in my life. This “everybody does it” stuff is a cop out excuse for irresponsibility.

    Accept the penalty for your f-ups in life, and learn from them … it’ll make you a better person.

  14. J, I think understanding that people have traumatic life events and disabilities that can interfere with their ability to stay on top of things 100% of the time would make you a better person.

  15. Yes, credit unions!! I use a great one in Portland, OR. Many are members of something called CU Services Center with Shared Branch members all over the US. You can make deposits and get some other banking services at any CU that is a shared branch member. See members at http://www.cuservicecenter.com.

  16. Forewarned is forearmed, as the old saying goes. No, I don’t
    consider any of the big U. S. banks to be ‘criminal organizations’
    (except in what their executive pay scales were, LoL). But you
    have a choice in where you bank. You CAN fire BofA and go with
    a credit union, or you can get an account at a smaller local bank
    (mine is no fees for 10 checks a month, $500 min balance) and
    I have a MMDA at BofA if I absolutely HAVE to get funds at an atm
    on the road. I have an “Electric Orange” account for (free) bill
    pay at ING, and I could probably just use that as my only bank account
    if I wanted to

  17. Jules, one “late fee” charge due to extenuating circumstances isn’t going to break anyone. In fact, if you are a good customer, banks and credit card companies will waive late and bounced check fees for one-off misdeeds.

    No, it’s the chronically irresponsible who whine about the fees the most, because that’s who gets hurt over and over by their own inability to manage their finances.

  18. That’s a contributing factor in my switching to USAA banking. Never had a problem with BOA, and never incurred any fees.

    Their interest rates on savings are arguably the worst in the country, so there’s no point in keeping a lot of cash with them. Their CD rates are not terribly competitive either.

    The only reason we currently do all our banking with BOA is out of convenience, and there are ATM’s nearly everywhere. However, USAA offers Deposit@Home where you scan in deposits, and they reimburse ATM fees up to $15 per month.

    -Grant

  19. Just dumped all of my BoA accounts last week. Opened up an FNBO savings account and a Schwab checking account. You have to open up a brokerage account as well but neither have minimums or any fees. Schwab obviously has no ATM’s anywhere so they refund all ATM fees at the end of every month. I like being able to use any ATM anywhere to get cash.

  20. Don’t use Bank of America. That simple. I let them nickle and dime me for way too long before switching to ING. Seriously, how often do you write checks? Almost everything can be done with direct deposit or debit these days. I use ACH (“electric checks”) for rent… everything else is automatic.

    ING’s rates used to be awesome, now they’re not, but no one else’s is either… but I like that they’re very good at online business. The one reason I don’t go with a credit union – they’ll almost certainly not have nearly as good an online website.

    As for those who have never had to pay an overdraft fee, well good for you, Mr. Holier than thou. We didn’t all start out being good with money, nor having a lot to spare. Anyone who’s had a late fee turn into an overlimit fee and get dinged with $80 on a credit card for it knows that even one time can be painful. (yes, if you call you can usually get it removed, but not everyone knows that).

    It’s still disreputable the way banks treat their customers. We’re already giving them our money to do with as they please, with their own rates they set specifically so they can make money. We shouldn’t have to pay for the privilege, especially in this electronic age where 99.9% of their work is computerized.

  21. I checked the BofA Web site and found this footnote:
    “Exclusions to Monthly Maintenance Fee changes do not apply to customers who opened a free MyAccess Checking account during specific time periods at Bankofamerica.com: Customers in GA and TX after 11/1/2006; and customers in any state after 4/20/2007.” I called customer service, and the representative verified that, since I opened my checking account online, my account will not incur any fees.

  22. Can anyone else confirm what Bill said? I am about to move overseas for over a year and would rather not keep $1500 sitting in a checking account without any interest. I opened my account online, but haven’t been able to confirm whether or not the fees apply to me. I’ll check tomorrow and post my experience. Can anyone else speak to this?

  23. I opened a MyAccess Checking account last year at a BOA branch. I do not need to pay any fee since I am a university alumni. After I read this acticle, it seems I have to set up a direct deposit for avoiding the free. Is any easy way to set-up a ‘generic’ direct deposit via Paypal or FNBO (an on-line saving account)?

    Thank you for your information.

  24. Well, some people may still have a special arrangement that would endure, it might be worth contacting BofA to clarify.

    You can set up a recurring automatic transfer at many online savings accounts, which BofA has treated as direct deposit in the past. Just be sure you have enough money to keep funding those transfers, or set up a reverse transfer to keep it going perpetually.

  25. Frugalboydave says:

    Yes Bill is correct: I documented my message with BOA last week.
    “I currently have My Access checking account which I opened online. Starting in June will there be monthly fees or minimum amounts to avoid a maintenance fee?
    Last text message receivedAngela S: If you applied online with the online promotion, the account would be a free account for you.
    You: Thanks.”

  26. The thing about CUs is you can use almost ANY CU ATM with no charge (they network together, and there are a ton of CUs out there). Which few people realize. I got friends who won’t leave their banks for the convenience, but they are always driving around looking for their bank’s ATMs to make a withdrawal for a fee. Yeah, sounds convenient (not).

    In this day and age I have no idea why you would need to live near a branch of your CU or bank. I’ve never had to go in person to my CU. Though I do go often because it is just down the street from my home. (I use the various CU ATMs throughout the country). I had a different CU from 1986 to 2006. It was in another city. I never stepped foot in the branch but to open the account. Could do everything by phone and mail.

    To be fair though, some CUs are pretty bad on the fees. I steer clear of any banks or CUs that charge so many fees though.

  27. Debbie, I have a college student account with BOA as well. When they were going to convert it to MyAccess automatically in the next few months. I called and asked them to keep it as a CampusEdge and they did without any hassle. Also the terms of MyAccess checking are different (No monthly maintenance fee, no minimum balance) if you opened it online. This is similar to what Bill Posted.

    Justjoeguy, do you deposits sent via PP show up as ACH?

  28. To play the devil’s advocate here… The fee does not apply if you opened online as I had done (imho, opening in a branch takes longer and they will try to sell you more stuff anyway). BoA is really convenient if you travel overseas you can take out cash (converted of course) without the standard 3% exchange fee + addl ATM fees. They make money on the exchange rate of course but it is pretty competitive rate. so far, I’ve used it in BNP (France), BNL (Italy), and CCB (China) ATMs. You can argue for the use of credit cards (Capital One, especially), but let’s be honest here, most small vendors overseas just don’t take credit cards.

  29. I’m great with staying on top of my accounts yet I got hit by overdraft fees three times in one day, when BofA decided to cash my rent check early (ie before the direct deposit of my salary) and THEN send it to my landlord so it would be there on the first. Safeguarding the amount, my ass. I called and got some very complicated explanation as to why they don’t do this with my other online bill payments, but they basically meant “we do what we want and you’re a sucker”.

    Of course they took the largest amount out of the account first, lawsuit or not, hence the multiple overdraft fees. I’m sending checks by mail again from now on.

    Really going to look into credit unions.

  30. Strick says:

    For the debit card overdraft charge ‘problem’, Use a bank that either doesn’t allow debit card POS and ATM overdrafts (Citibank, credit unions) or one that lets you select ahead of time that you don’t want them (PNC).

    Just realize now that this just changes the punishment for not keeping up with your balance (or keeping a good buffer, for slackers like me) from overdraft fees to washing dishes for that angry guy you just ate a meal off of. There’s always gonna be some price to pay for not being financially responsible.

  31. Chris Brown says:

    They are raising their credit card fees too. I received a notice stating cash advances get dinged a 4% charge off the top. Also purchases made in a foreign currency get dinged 4% plus the currency conversion fee usually 1-1.5%.
    At least on my card.
    Glad I don’t use credits cards for getting cash.
    Glad I use AmEx when I travel. Maybe its time to close my BoA credit card. Its my oldest account and looks good on my credit report but……

  32. Phinance says:

    There are situations where anyone can mess up, though I agree that frequent bounced checks and overdrafts can be bad for banks.

    However, the amount they’re proposing to charge is ridiculous!

  33. USAA and Navy Fed Credit Union. Both have never given me even a hint of the pain and suffering of banks like Bank of America or Chase.

    Not only are the interest rates higher, all accounts are free, and the websites are great. They have some of the best customer service anywhere, USAA actually is probably the single best customer service I have ever had.

  34. I opened the account in a branch and I got hit by some fees (when I lost my job and there was no direct deposit).

    I closed it and I opened the MyAccess account online, my account does not incur any fees.

  35. The stuff I got said that the deposit had to be a “qualifying deposit” It is a reasonable assumption that means a direct deposit, but they don’t define it anywhere that I can find.

  36. BofA bent me over the table and srewed me so hard that I’m still bleeding. I was an account holder since my first year of college. (Back then it was United National then Fleet then BofA) I was a premier customer and for over ten years I had more than $20k in their crappy bank. I AM A SHREWD money manager. I have a BS in business. I’m always keen and always on time. Then I got laid off and started a consulting business. Apart from working 80 hours a week for beans, income is sporadic. It’s impossible to keep up with daily balances and ONE day of a check not being deposited by 12 noon added up to $650 of fees. Then the maintenance fees started that NEVER existed before. Then fees for ATM use, then check fees. WTF?? HERE is the kicker: I had “overdraft protection” from my savings account. All that did was provide the cash to cover shortages – I WAS STILL BILLED $35 PER OVERDRAFT TRANSACTION. I asked, “Why? is someone paid to make the transfer manually?” The answer was, “No, a computer does it.” “So why do I have to pay $35 per transaction? They’re my accounts, it’s my money, and I am supposed to be protected!?” The answer was, “Well, sir it’s a standard fee. Any bank would charge that.” Bull. They get a bailout for bad decisions. Where’s my friggin bailout for bad circumstances?? And to J who commented above – screw you, I hope you lose your job and get overdrafted every day. But I’m guessing you’re a BofA employee – mostly because both your heart and your IQ are about as worthless as BofA stock.

  37. Jennifer says:

    My boss has BoA business checking – they charge her $13/mo for each month she doesn’t use her BoA debit card. She has to use it now to avoid the fee, but previously never had to. What a PITA.

  38. angelPH says:

    I absolutely agree with you, JoeyC. I am in an identical situation, no job, trying to get some consulting gigs. the income flow is painful to say the least. Customer’s checks are bouncing or coming in late or not coming in at all, despite of the job done, simply because they are in the same financial situation. The postponed check deposited by my child’s care by mistake 4 days earlier than the date indicated on the check was paid by BOA regardless resulting in total of $175 overdraft fees in one week and no amount of begging and trying to reason with them worked. When I asked them why did they honor this check 4 days earlier instead of simple refusing to accept it, they said this was no Europe and the moment check is posted they would pay it and they don’t care about the date. WTF?What kind of nonsense is that? The only solution the reps of this rotten bank could have suggested is to demand from the Day Care to cover my overdraft fees since they made a mistake. As for your righteous snotty comments, J. screw you, twice! Obviously all the efforts to plan and budget fail when something that you have NO control over happens. I hope you loose your job and won’t be even able to find the dish washing gigs and get hit with thousands of dollars in overdraft fees weekly and go and kiss the BOA ruthless ass for hours to no avail.

  39. So on vacation last weekend, I ended up missing my balance by one transaction of $13 and change. Monday morning, many transactions were pending, so I transferred money to cover them. Poof, 7 OD fees. Followed by the domino effect. Result? $350 in OD fees in 4 days. *sigh*

    My conversation with the bank manager when I truly humbled myself and went to ask for help. We’ll call him the BM – which seems fitting.

    BM: “you called cust. serv. – and what did they tell you?”
    Me: “she wasn’t as helpful as I had hoped – said the system wouldn’t allow her to do anything”
    BM: “well there’s your answer then.”
    Me: “You mean to tell me that as the branch manager, you have no more authority than an $8/hr phone rep? How rewarding that must be for you.”
    BM: “The system dictates based on several” yada yada bs bs “.”
    Me: “Again, how empowering.”

    What I WANTED to say:

    “I’d punch you so hard your ancestors will bleed, but I’d have to take a penicillin bath after touching your slimy used-car-salesman ass”

    How frustrating.

    And yes, J – eat shit. Anal blistering festering gash. Whatever – no one believes you. Daddy touch you wrong or what?

    26% of BOAs revenue last year was from fees. CEO Ken shows up to ask for billions in a corporate jet. Anything wrong with this picture? This isn’t ‘banking’, it’s extortion. Make your money like a financial institution should.

    Grow a set, BOA. I’m done with you.
    http://www.ingdirect.com here I come.

  40. tentaculistic says:

    I just wanted to let people know of a trick that will help you get around Bank of America’s newly-raised checking fees.

    Pull a small amount to PayPal, and then once a month send $1 to each of your checking accounts. The deal is that they only charge you if you do NOT have direct deposit to that account (so if you get all or a portion of your paycheck automatically deposited, there’s no fee), but sending money to your checking account from another financial institution (in my case PayPal, but I’ve heard ING works well too – and with ING you can send money automatically which is a huge plus!) gets around that fee.

    I saw it online, tried it, and sure enough I stopped hemorrhaging $9 every month! And best of all, it punishes those BoA bastids who stole our tax money, trashed our economy, and now are trying to screw us again for the fines. But that’s another post :)

  41. I Hate Idiots says:

    J, does the J stand for J*** Off? Do you work for BofA?

    Bank earnings have been on the rise lately thanks to the fees earned off the backs of hard working Americans. You sound like a republican who follows his political beliefs in a blind and unquestioning manner.

    First, who the f*** is aking for your sympathy and second, who the f*** are you to judge what amount of fees can or can’t “break” someone?

    YOU ARE AN IDIOT!!!

    I’m happy for you that you’ve never bounced a check but maybe if did, at least once in your miserable and pathetic life, you might amount to something more than just a wet spot on your parents’ sheets.

    Take that to your next Town Hall meeting, you f***in’ idiot.

  42. My landlord held my rent check for 2 weeks while his bookkeeper was out of town on vacation. He told me what date my check would be deposited. I had an emergency but would have the funds to cover the check well before the deposit so I used the money in the account. By the time the rent check was deposited, the funds were back in place, but BofA used the check date, not the deposited date, went back 2 weeks and dinged me for MULTIPLE ‘bad checks’. Talking to them did no good whatsoever, so now I’m in the process of looking for another bank. I dont travel out of the country so does anyone have a suggestion?

  43. Mary, I am sorry to hear about your your troubles. You can fight them. I did. BOA charged me insufficient funds fees when my account was positive and remained this way even after they charged 4! fees! They explained that my transactions were lining due to their reordering transactions practice) that my account may have been overdrawn hypothetically! So, now they charge you for what could have happened. I tried to reason with them, useless! Spoke with 3 supervisors – nothing! So I submitted complaint to the OCC. Below is the link – you can do it online and guess what? A month later I received a fat envelope from BOA with printouts and long explanations why what they did was right thing to do but as a courtesy they are refunding those fees and so on.
    BTW, Chase had abandoned the transactions reordering practice, the others are still to follow the suit. J sure works for BOA, don’t mind his self-righteous comments.

    http://www.occ.treas.gov/customer.htm

  44. I opened a checking account with BoA 6 years ago when I bought my house. I don’t remember if it was online or not (likely was). Each month I transfer enough to fund this account to pay my mortgage and occasionally an additional amount when I use my credit card. I was never charged a fee until now (never used overdraft or had a balance issue). I never had direct deposit. Nothing changed on my end! They decided to start charging me a monthly fee out of nowhere.

    I called and received no valid explanation other than there must have been a waiver on my account that expired. A 6 year waiver? The CSR offered to reimburse the $8.95 and a waiver was put on the account for one year. The CSR said to call back next and ask them to extend it another year. Now it’s my chore to remember and beg for my $8.95 back!

    That’s 107.40 a year. This is cleverly disguised theft. Fleet bank years ago pulled this same kind of nonsense. Where are the banking regulators? We had an agreement and they changed the terms without my consent. Can I reduce my mortgage payment by $8.95 because I feel it would benefit my household?

  45. My account was changed 5mos ago without me realizing it till now. That is when I started getting charged a service fee because my account is only “free” if I maintain $1000 EVERY DAY. I’m changing banks this weekend.

  46. J, you are an idiot. Granted, some people do continually mess up and blame the banks. However, how can you ever take the Banks side, after all the shadiness that’s happened lately?

  47. Look folks,the banks are still screwing us with there casino games using our money.Talk about being responsible adults.

  48. Responsible ADULTS do not have to worry about fees. When did we turn into such a “cry baby” Country? You get the representation that YOU vote for.

  49. rick,

    Responsible ADULTS do not have to worry about fees? What about those that are responsible and get charged fees through shady and unfair practices imposed by the banks? How does that make you a “cry baby” if you resent being “screwed”?

    Rob

  50. Mostly I use a credit union, but had $2k sitting in a B of A checking account for 5 years and never a fee until this month I got hit for $20. No explanation, but may have to do with my Banc America brokerage account getting rolled into Merrill Lynch now owned by B of A but maybe no longer qualifying as part of a minimum balance. So I closed the checking account. If my brokerage account begins to incur major random fees it will be time to head for Scottrade.

  51. Well, when you have the goberment step in to “help” consumers, big business fights back. That’s how it is. Banks control the entire system and they always have since the Federal Reserve stepped in.

    Best of Luck. This is just the beginning. They’re going to find a way to get their money out of you.

    –Jack Beans

  52. I have about $1400 sitting in BOA checking account for a long time with no interest at all. I went out of country for 18 months overseas job assignment and came back to see BOA had charged me $10/month for 16 months due to the minimum balance requirement is changed to $1500. I talked to BOA but they won’t refund anything, not a single dollar.
    I am going to move out of BOA for good.

  53. They recently raised the minimum balance on my checking account to $1500; I don’t recall every seeing anything straight forward about a minimum balance increase in my monthly statement and if it weren’t for me just randomly checking my balance, I wouldn’t have noticed the $14 deduction my account.

    I’ve never had this problem with any other financial institution and honestly, I hope that Julian Assange gives it to these guys.

  54. Just checked my BoA account and it says as of May 2011 a qualifying amount for DD is $250.

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    [...] Bank of America Raises Fees on Checking Accounts [...]

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