Big Bank Fees Holding Back U.S. Economic Recovery

[hvactec]

Bank fees are not just bad for consumers, they're bad for the economy.

A growing number of Americans are unable to afford a bank account -- a situation that in turn puts a strain on the economy because those same people can't access credit, Bloomberg's chief economist Joseph Brusuelas warned Thursday in an economic report. The rise in the number of Americans who don't have a bank account has "hindered consumption and overall growth in the current weak recovery," Brusuelas wrote.

Between 2009 and 2011, the number of households that went off the banking grid -- called the "unbanked" -- increased by 800,000, according to the most recent data from the Federal Deposit Insurance Corporation. Overall, more than 40 percent of low-income households, those earning between $15,000 and $50,000 annually, have a very limited relationships with banks, according to the FDIC data.

One reason for the spike in households that don't use a bank: they simply can't afford it. A checking account at a retail bank costs an average of $144 per year and overdraft fees can add hundreds of dollars more to the cost, research from Pew Charitable Trust has showed.

read more Big Bank Fees Holding Back U.S. Economic Recovery

 

[emptystep]

The concept of 'job creators' being 'job destroyers' completes escapes some.

Forgot to say:

 

[SteadyMercury]

One reason for the spike in households that don't use a bank: they simply can't afford it. A checking account at a retail bank costs an average of $144 per year and overdraft fees can add hundreds of dollars more to the cost, research from Pew Charitable Trust has showed.

$144/year is $12/month, how many households really can't have a bank account because of $12/month?

I don't care about the overdraft fees that is a money management issue, not an affordability issue.

 

[uscitizen]

Actually economic recovery is doing fine. due to such things as those bank fees and such.
What still sucks is the worker recovery.

 

[CrusaderFrank]

This may be the stupidest OP since Obama blamed bank ATMs and airports kiosks for hurting the economy

 

[BillyV]

Bank fees are not just bad for consumers, they're bad for the economy.

A growing number of Americans are unable to afford a bank account -- a situation that in turn puts a strain on the economy because those same people can't access credit, Bloomberg's chief economist Joseph Brusuelas warned Thursday in an economic report. The rise in the number of Americans who don't have a bank account has "hindered consumption and overall growth in the current weak recovery," Brusuelas wrote.

Between 2009 and 2011, the number of households that went off the banking grid -- called the "unbanked" -- increased by 800,000, according to the most recent data from the Federal Deposit Insurance Corporation. Overall, more than 40 percent of low-income households, those earning between $15,000 and $50,000 annually, have a very limited relationships with banks, according to the FDIC data.

One reason for the spike in households that don't use a bank: they simply can't afford it. A checking account at a retail bank costs an average of $144 per year and overdraft fees can add hundreds of dollars more to the cost, research from Pew Charitable Trust has showed.

read more Big Bank Fees Holding Back U.S. Economic Recovery

This is absurd. Retail banking fees are not even in the same universe with check cashing stores and payday lenders; unless someone is paid under the table or is completely off the grid (in some illegal enterprise), cashing a check every week or two at a check cashing store at 2-4% of the amount is guaranteed to be more than $144 per year. And as has already been said, overdrafts are a management issue. Just another jab at the "evil banks" that are out to destroy the poor, while they use alternative sources that cost much more. I guess this is just the preamble to the government regulating bank fees "for the good of the consumer" just like they did with credit cards. Anyone's credit card interest rate go down as a result?

 

[emptystep]

Bank fees are not just bad for consumers, they're bad for the economy.

A growing number of Americans are unable to afford a bank account -- a situation that in turn puts a strain on the economy because those same people can't access credit, Bloomberg's chief economist Joseph Brusuelas warned Thursday in an economic report. The rise in the number of Americans who don't have a bank account has "hindered consumption and overall growth in the current weak recovery," Brusuelas wrote.

Between 2009 and 2011, the number of households that went off the banking grid -- called the "unbanked" -- increased by 800,000, according to the most recent data from the Federal Deposit Insurance Corporation. Overall, more than 40 percent of low-income households, those earning between $15,000 and $50,000 annually, have a very limited relationships with banks, according to the FDIC data.

One reason for the spike in households that don't use a bank: they simply can't afford it. A checking account at a retail bank costs an average of $144 per year and overdraft fees can add hundreds of dollars more to the cost, research from Pew Charitable Trust has showed.

read more Big Bank Fees Holding Back U.S. Economic Recovery

This is absurd. Retail banking fees are not even in the same universe with check cashing stores and payday lenders; unless someone is paid under the table or is completely off the grid (in some illegal enterprise), cashing a check every week or two at a check cashing store at 2-4% of the amount is guaranteed to be more than $144 per year. And as has already been said, overdrafts are a management issue. Just another jab at the "evil banks" that are out to destroy the poor, while they use alternative sources that cost much more. I guess this is just the preamble to the government regulating bank fees "for the good of the consumer" just like they did with credit cards. Anyone's credit card interest rate go down as a result?

Maybe this is exactly the point. "evil banks". Maybe the reputation of all financial industries have gotten so bad with some that they will not use them. When banks will take a home away for a single missed payment you expect a single mother to put all the money she has into one of these places. If the bank back puts you out on the street don't expect the government to come to your aid either. Who do you think runs the government?

 

[BillyV]

Bank fees are not just bad for consumers, they're bad for the economy.

A growing number of Americans are unable to afford a bank account -- a situation that in turn puts a strain on the economy because those same people can't access credit, Bloomberg's chief economist Joseph Brusuelas warned Thursday in an economic report. The rise in the number of Americans who don't have a bank account has "hindered consumption and overall growth in the current weak recovery," Brusuelas wrote.

Between 2009 and 2011, the number of households that went off the banking grid -- called the "unbanked" -- increased by 800,000, according to the most recent data from the Federal Deposit Insurance Corporation. Overall, more than 40 percent of low-income households, those earning between $15,000 and $50,000 annually, have a very limited relationships with banks, according to the FDIC data.

One reason for the spike in households that don't use a bank: they simply can't afford it. A checking account at a retail bank costs an average of $144 per year and overdraft fees can add hundreds of dollars more to the cost, research from Pew Charitable Trust has showed.

read more Big Bank Fees Holding Back U.S. Economic Recovery

This is absurd. Retail banking fees are not even in the same universe with check cashing stores and payday lenders; unless someone is paid under the table or is completely off the grid (in some illegal enterprise), cashing a check every week or two at a check cashing store at 2-4% of the amount is guaranteed to be more than $144 per year. And as has already been said, overdrafts are a management issue. Just another jab at the "evil banks" that are out to destroy the poor, while they use alternative sources that cost much more. I guess this is just the preamble to the government regulating bank fees "for the good of the consumer" just like they did with credit cards. Anyone's credit card interest rate go down as a result?

Maybe this is exactly the point. "evil banks". Maybe the reputation of all financial industries have gotten so bad with some that they will not use them. When banks will take a home away for a single missed payment you expect a single mother to put all the money she has into one of these places. If the bank back puts you out on the street don't expect the government to come to your aid either. Who do you think runs the government?

Yes, I'm sure the 800,000 newly "unbanked" are the result of foreclosure for missing one payment.

It's the single mother's choice where to put her money; if she wants to pay double or triple for cashing her check rather than open a bank account, it's her own business.

By the way, according to Freddie Mac, bank foreclosures for one missed payment is a myth. It's more likely that the "owner" takes squatters rights and ties up the foreclosure process so they can live an extra 2 or 3 years in the home for nothing.

[ame=http://www.youtube.com/watch?feature=player_embedded&v=3pfDadtjNek#!]Myth #3: Get the Facts on Foreclosure - YouTube[/ame]

 

[PredFan]

WTF? Where are these people banking? Mine is $6 a month if I don't keep at least $1000 in there.

Overdraft fees? Well, if you write checks on money you don't have then you deserve to pay. Stupidity should be painful and costly.

 

[emptystep]

This is absurd. Retail banking fees are not even in the same universe with check cashing stores and payday lenders; unless someone is paid under the table or is completely off the grid (in some illegal enterprise), cashing a check every week or two at a check cashing store at 2-4% of the amount is guaranteed to be more than $144 per year. And as has already been said, overdrafts are a management issue. Just another jab at the "evil banks" that are out to destroy the poor, while they use alternative sources that cost much more. I guess this is just the preamble to the government regulating bank fees "for the good of the consumer" just like they did with credit cards. Anyone's credit card interest rate go down as a result?

Maybe this is exactly the point. "evil banks". Maybe the reputation of all financial industries have gotten so bad with some that they will not use them. When banks will take a home away for a single missed payment you expect a single mother to put all the money she has into one of these places. If the bank back puts you out on the street don't expect the government to come to your aid either. Who do you think runs the government?

Yes, I'm sure the 800,000 newly "unbanked" are the result of foreclosure for missing one payment.

It's the single mother's choice where to put her money; if she wants to pay double or triple for cashing her check rather than open a bank account, it's her own business.

By the way, according to Freddie Mac, bank foreclosures for one missed payment is a myth. It's more likely that the "owner" takes squatters rights and ties up the foreclosure process so they can live an extra 2 or 3 years in the home for nothing.

[ame=http://www.youtube.com/watch?feature=player_embedded&v=3pfDadtjNek#!]Myth #3: Get the Facts on Foreclosure - YouTube[/ame]

I was talking about perception. So 'get the facts' is all well and good but misses the point. If a bank accidentally screws a customer what is that person's recourses? As was discussed on another thread it is a risk/reward equation. The risk just doesn't justify using a bank over cash transactions for some people.

 

[kiwiman127]

One factor that is holding up the speed of the recovers is companies are
not investing enough their infrastructure and expansion that create jobs. Instead companies pay their shareholders which does nothing to create jobs or stimuate the economy.

 

[martybegan]

WTF? Where are these people banking? Mine is $6 a month if I don't keep at least $1000 in there.

Overdraft fees? Well, if you write checks on money you don't have then you deserve to pay. Stupidity should be painful and costly.

Another thing to do is make sure you only use your own bank's ATM's. I ended up with Chase after they bought out WAMU. Thier overall fees are higher, but they have ATM's freaking everywhere.

I save $20-30 a month using only Chase ATM's compared to when I used ATM's all over the place without regard to the fees.

 

[CrusaderFrank]

$12 buys 3 gallons of gas.

What's hurting the economy?

 

[SteadyMercury]

One factor that is holding up the speed of the recovers is companies are not investing enough their infrastructure and expansion that create jobs. Instead companies pay their shareholders which does nothing to create jobs or stimuate the economy.

I'm not sure this is true. If by paying their shareholders you mean dividend yield yes it is slightly up compared to recent years but at 2.13% for 2012 it isn't really remarkable.

 

[EdwardBaiamonte]

When banks will take a home away for a single missed payment

that of course is a one in a milllion event that you are using as typical because you are a low IQ liberal and character free liberal. Sorry

 

[emptystep]

When banks will take a home away for a single missed payment

that of course is a one in a milllion event that you are using as typical because you are a low IQ liberal and character free liberal. Sorry

3.4 Million Completed Foreclosures since Sept. 2008, CoreLogic Reports
by ChrisGuldi on April 10, 2012

From the start of the U.S. financial crisis in September 2008, CoreLogic reports that approximately 3.4 million foreclosures have been completed.

So 3.4 people missed one payment. I would imagine if you went through all 3.4 million you might find more than 3.4 who basically got cheated out of their home. Oh, but it was their fault however, all 3.4 million of them.

At some point this stuff will begin to disgust me.

 

[EdwardBaiamonte]

When banks will take a home away for a single missed payment

that of course is a one in a milllion event that you are using as typical because you are a low IQ liberal and character free liberal. Sorry

3.4 Million Completed Foreclosures since Sept. 2008, CoreLogic Reports
by ChrisGuldi on April 10, 2012

From the start of the U.S. financial crisis in September 2008, CoreLogic reports that approximately 3.4 million foreclosures have been completed.

So 3.4 people missed one payment. I would imagine if you went through all 3.4 million you might find more than 3.4 who basically got cheated out of their home. Oh, but it was their fault however, all 3.4 million of them.

At some point this stuff will begin to disgust me.

Will someone tell the absolutely brain dead airhead liberal that a bank does not forclose for one missed payment!!! It would cost them a ton of money, obviously!!

 

[emptystep]

that of course is a one in a milllion event that you are using as typical because you are a low IQ liberal and character free liberal. Sorry

3.4 Million Completed Foreclosures since Sept. 2008, CoreLogic Reports
by ChrisGuldi on April 10, 2012

From the start of the U.S. financial crisis in September 2008, CoreLogic reports that approximately 3.4 million foreclosures have been completed.

So 3.4 people missed one payment. I would imagine if you went through all 3.4 million you might find more than 3.4 who basically got cheated out of their home. Oh, but it was their fault however, all 3.4 million of them.

At some point this stuff will begin to disgust me.

Will someone tell the absolutely brain dead airhead liberal that a bank does not forclose for one missed payment!!! It would cost them a ton of money, obviously!!

From another thread:

I overheard a discussion between realtors yesterday about the housing market here in Las Vegas - they said the banks are holding back 8,000 homes from the market! ...

If someone pays down a few thousand on a home, the bank yanks it, another person pays down a few thousand on that house the bank just got a few thousand twice for exactly the same house, and the bank still owns it.

What do you think banks do all day?

 

[EdwardBaiamonte]

3.4 Million Completed Foreclosures since Sept. 2008, CoreLogic Reports
by ChrisGuldi on April 10, 2012


So 3.4 people missed one payment. I would imagine if you went through all 3.4 million you might find more than 3.4 who basically got cheated out of their home. Oh, but it was their fault however, all 3.4 million of them.

At some point this stuff will begin to disgust me.

Will someone tell the absolutely brain dead airhead liberal that a bank does not forclose for one missed payment!!! It would cost them a ton of money, obviously!!

From another thread:

I overheard a discussion between realtors yesterday about the housing market here in Las Vegas - they said the banks are holding back 8,000 homes from the market! ...

If someone pays down a few thousand on a home, the bank yanks it, another person pays down a few thousand on that house the bank just got a few thousand twice for exactly the same house, and the bank still owns it.

What do you think banks do all day?

Will someone tell the absolutely brain dead airhead liberal that a bank does not forclose for one missed payment!!! It would cost them a ton of money, obviously!!

 

[BillyV]

When banks will take a home away for a single missed payment

that of course is a one in a milllion event that you are using as typical because you are a low IQ liberal and character free liberal. Sorry

3.4 Million Completed Foreclosures since Sept. 2008, CoreLogic Reports
by ChrisGuldi on April 10, 2012

From the start of the U.S. financial crisis in September 2008, CoreLogic reports that approximately 3.4 million foreclosures have been completed.

So 3.4 people missed one payment. I would imagine if you went through all 3.4 million you might find more than 3.4 who basically got cheated out of their home. Oh, but it was their fault however, all 3.4 million of them.

At some point this stuff will begin to disgust me.

I would agree that some may have been "cheated" (tens of billions of bank settlements are not offered for no reason), although there is no evidence to support the "one missed mortgage payment" theory. People that said they were cheated fell into two main groups (as far as I can tell) - those who were convinced to take on home equity debt where the interest (and payment) subsequently reset (although they didn't mind spending whatever money was borrowed; hard to feel too sorry for this group), and those who were seeking modifications and were supposedly told that "if you stop making your payments we can modify the loan. There's no assistance for up-to-date borrowers", then the banks subsequently foreclosed the loans without offering the modifications (of course, there is no evidence on the bank side that indicates this type of advice was offered, only the word of the borrower, but it happened often enough that it seems very likely to be true). While this may have led to some animosity toward the banks by both affected borrowers and those aware of their stories, I find it hard to believe that was the proximate cause of the "unbanked." One thing really has nothing to do with the other; a lower income person with a few bucks in a checking account is fully protected by the FDIC and would have no reason to assume their money was in danger of being taken.

As far as banks "holding back" homes, of course they want to get the highest price for their assets; putting them all on the market at once would not be the way to accomplish that. Supply and demand, you know.