Mind On My Money #237: Bank Fees On the Rise!

Bounced-check fees and ATM surcharges for all checking account types have reached new highs -- again. Meanwhile, fees and balance requirements for interest and noninterest checking accounts continue to move in opposite directions, with those for interest accounts ratcheting higher while noninterest account costs move lower still.

There is some good news in the area of online checking accounts. Those are the key findings in the Fall 2007 Bankrate.com Checking Account Pricing Study. Bankrate's Fall 2007 Checking Study findings:

• Bounced check fees hit new high
• ATM surcharges keep going up
• Big difference between interest and noninterest
• Balance requirements on interest accounts up 25 percent
• You can save with noninterest accounts
• Banks keep ATM fees low for own customers
• You can take steps to avoid fees

Bankrate.com surveyed one interest and one noninterest checking account at the largest banks and thrifts in each of 25 large markets to find the latest trends on checking account and ATM fees. The offerings of 249 institutions were surveyed, with 247 interest accounts and 226 noninterest accounts in the survey. Bankrate.com also looked at the checking accounts of 16 Internet banks to see how those offerings stack up against their brick-and-mortar counterparts.

Nod to Greg McBride, CFA • Bankrate.com

MIND ON MY MONEY: ING BANK? THE ORANGE BALL? VIRTUAL BANKING?

ING Bank is a company that seems to be everywhere, but in essence is nowhere.

I see you ING Bank, advertised on television, magazines, and newspapers ... but where is the ING Bank branch to cash my pay check, get a travelers check or run to, with cash in hand to "cover a check."

I see you ING Bank, in my mailbox with that orange envelope offering me $25.00 if I open an account, I see you on billboards and yes, I see you on your now famous park bench advertising. So where is the ING Bank branch to get that certified check, put the jewels in the safe deposit box or ask the eternal question “when will this check clear?”

Finally, where is the ING Bank branch with my most important features; like that cute Filipino teller with the great smile, the free cookies and the free espresso from your “state of the art single cup variable coffeemaker." One minute I see ING Bank the next minute I don't, but it always feels like you’re following me around. So to borrow a phrase from the film “Butch Cassidy & the Sundance Kid” let me ask, “Who are those guys?”

ING Bank is a "virtual" bank that only exist in cyberspace. You do all your banking online. No brick, mortar or smiling teller. You give up all this for what they have reasoned, you the consumer really want; very high interest rates and not a whole lot of fluff. How high you ask? While the typical savings account gives you 0.46% interest. ING is offering a whopping 4.5% on a regular savings.

Where the heck did they get such an idea would catch on?

Well … from you. Consumers put up with ticket less flying and Southwest Airlines surged their profits with no reserved seating. You don’t mind going to Home Depot and the grocery store and doing "self check out". You are buying from IKEA, designer furniture that you don't mind assembling yourself and paying bills online has cut your late fees in half, right?

ING Bank Direct other stats:

The largest Internet bank with half of the $90 billion done in online banking.

• More than 5 million account holders (100-150 thousand new each month)
  
• No fees no minimum balances
  
• Live customer service here in the U.S., no voice prompt from Calcutta India
  
• 5 Ciber cafes in major cities if your DSL goes down.
  
• Reluctantly have started checking accounts
  
• Offers only two mortgages 5year@ 6.6% and 7year @ 6.67% (because they figure most people move or refinance in 7 years.
  

ING BANK - we may not see you, but we are definitely feeling you!

BUT DAMN #228 B of A NO FEE MORTAGES ARE FOR REAL, DOG!

I've heard about those "No Fee" mortgages.

BUT DAMN ...

One bank says I get $250 if it doesn't work!

Bank of America insists its new "No Fee Mortgage Plus" delivers what it says without raising interest rates to applicants. The program comes with none of the traditional mortgage and settlement charges -application fee, appraisal fee, credit, title insurance, title search, private mortgage insurance, closing fees, among others-and offers competitive rates.

Now you folks know that on a regular home loan purchase, fees can amount to 3 to 5 percent of the mortgage amount. This can run in the thousands of dollars.

For me, the worse part about buying property is seeing all the "junk fees" tagged on and all the mortgage brokers and loan officers claiming they are "industry standard". The standard is to take all us buyers to the cleaners.

Bank of America is talk'n the talk. They are trying to make a bold move in time of very stagnent interest rates and subzero home purchases.

Does B of A walk the walk? Hell yes! Check this out. B of A is so sure of it'self they suggest, "Take your B ofA quote in hand and comparison shop with any other lenders. If you are approved by B of A for the loan and then choose to close with a competitor, the bank promises to pay $250!!!

Ok, so what are the catches?

1) You can't apply unless you already have an account with the bank, however minimum.

2) State and local taxes, property taxes and other government levies are not covered. Nor are prepaid interest, discount points, hazard or flood insurance and homeowner association fees.

3) And ... The program is for home purchase or second properties. No refinancing allowed.

That being said, go out give it a try. After you are done, pull up this same blog article. And leave your comments by clicking on "FOLKS WHO GET IT"