Bank of America http://www.wisebread.com/taxonomy/term/796/all en-US BankAmericard Secured Visa Card Helps Protect You From Identity Theft http://www.wisebread.com/bankamericard-secured-visa-card-helps-protect-you-from-identity-theft <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/bankamericard-secured-visa-card-helps-protect-you-from-identity-theft" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="/files/fruganomics/imagecache/250w/blog-images/woman_online_shopping_credit_card_000012191747.jpg" alt="Woman shopping online with credit card" title="" class="imagecache imagecache-250w" width="250" height="141" /></a> </div> </div> </div> <p>Bank of America is one of the top 21 largest companies in the United States by total revenue and is well-known for providing a wide variety of financial products, including the BankAmericard&reg; Secured Visa. This card is designed to help consumers who have no credit established, are in the process of rebuilding, or just want to boost their current credit rating.</p> <p>Because of its status as one of the largest bank holding companies in the country, the BankAmericard&reg; Secured Visa Card is considered a highly rated secured card, which provides various benefits and services to its card holders.</p> <h2>How This Card Works</h2> <p>When you are approved for the card, a security deposit of at least $300 is required to open the account. You can deposit as much as $4,900. Your credit limit is determined by your income, ability to pay, and the amount of your security deposit. Your account activity is reported to the three major credit bureaus. If you manage your account responsibly, over time you can build or <a href="http://www.wisebread.com/a-secured-credit-card-can-repair-your-credit-score-heres-how-to-pick-the-best?ref=internal">rebuild a positive credit rating</a>. After 12 months, Bank of America will review your account. You may qualify to have your security deposit returned while you continue using your card.</p> <h2>Other Benefits</h2> <p><strong>ShopSafe&reg;</strong>. One of the features included that provides additional security when you shop online. If you sign up for ShopSafe&reg;, you can receive a temporary 16-digit account number to use while shopping online, rather than risking your credit card number. This number also includes an expiration date and security code, and can be valid for up to one year, depending on the time period you choose.</p> <p><strong>SafePass&reg;</strong>. This is another security feature designed to protect your card account information when you bank online or with your mobile phone. SafePass&reg; allows you to register, you receive a 6-digit code that you can use to authorize transactions through verification.</p> <p><strong>Chip card</strong>. Chip cards are cards that are embedded with a microchip and provide better protection and security against fraudulent purchases. These cards are often preferred by retailers, especially in Europe, over standard cards with just the magnetic stripe, and may become the security standard in the United States.</p> <h2>Costs</h2> <p>The annual fee is $39 per year. Balance transfers are $10 or 3%, whichever is greater. The foreign transaction fee is 3%.</p> <p>The APR for purchases and balance transfers is based on your credit worthiness and is 20.24%. The APR also varies with the prime rate.</p> <h2>Pros</h2> <p><strong>Multiple locations</strong>. There is an advantage to carrying a card backed by the second largest bank holding company in the United States. This provides additional convenience when banking or finding ATMs in the event you need a cash advance from your card. Many secured credit cards are provided by lesser known and unknown banks and card issuers, which makes it difficult if you prefer to stop by a branch while running errands. This is also beneficial if you already bank with Bank of America or plan to in the future.</p> <p><strong>Qualify for higher credit limit.</strong> Your credit limit is dependent on other circumstances, such as your income, which can result in a higher credit limit, rather than just being decided by how much you are able to deposit. The credit limits on most secured credit cards is based on the amount of your security deposit.</p> <p><strong>Security deposit return</strong>. Upon review, there is a possibility that your deposit will be returned to you after 12 months, allowing you to continue to use the card as an unsecured credit card. There are very few secured cards which are able to offer graduation to an unsecured card once you have established a positive credit rating with the secured version. This allows you to keep your account open even after you have improved your credit and provides the benefit of an aged account to your credit rating.</p> <h2>Cons</h2> <p><strong>Annual fee</strong>. The annual fee of $39 per year is actually quite common with secured credit cards, but it is near the highest annual fee charged, which can be as much as $50 per year. There are also secured credit cards with no annual fees, like the <a href="http://www.wisebread.com/capital-one-secured-mastercard-credit-card-review?ref=internal">Capital One Secured MasterCard</a>.</p> <p><strong>High APR</strong>. The APR of 20.24% is among the highest APRs associated with a secured card. Cash advances can be even higher at 24.99%, with no grace period. This is not a problem if you are diligent in paying your balance in full each month, but if you typically carry a balance from month to month, a card with a lower APR will cost you less money. There are also other options such as the <a href="http://www.wisebread.com/first-choice-bank-primor-secured-visa-gold-card-review?ref=internal">primor Secured Visa Gold</a>&nbsp;which carry an APR of 9.99%.</p> <p><strong>No interest on security deposit.</strong> The security deposit for secured credit cards is held while the account is open, in the event you default on the balance. When you close the account, and if you have a zero balance at the time, the deposit is returned to you. However, there are secured cards such as the <a href="http://www.wisebread.com/first-choice-bank-primor-secured-visa-gold-card-review?ref=internal">primor Secured Visa Gold</a> and <a href="http://www.wisebread.com/usaa-secured-card-american-express?ref=internal">USAA Secured Card American Express</a>, which hold your deposit in CDs or savings account that earn interest so that when it is refunded, you have earned a little extra money on your security deposit.</p> <p><strong>Foreign transaction fee</strong>. There is a foreign transaction fee of 3%, which is generally the highest foreign transaction fee charged by credit cards. If you travel outside of the United States often, this fee can add up. Although it's rare for a secured credit card to not carry a foreign transaction fee, there are options such as the <a href="http://www.wisebread.com/capital-one-secured-mastercard-credit-card-review?ref=internal">Capital One Secured MasterCard</a>&nbsp;that offers zero foreign transaction fees.</p> <h2>Who This Card Is Best For</h2> <p>The BankAmericard&reg; Secured Visa Card is best for those who are working on <a href="http://www.wisebread.com/what-are-secured-credit-cards?ref=internal">repairing or building a good credit score</a> and prefer the benefits provided by a large bank over those that are lesser known. It is also best if you typically pay your balance in full each month rather than carry a balance from month to month because of the APR. If you travel outside of the United States or intend on using the card for foreign purchases, you should, instead, consider a card that does not carry a foreign transaction fee. (See our favorites for <a href="http://www.wisebread.com/the-5-best-secured-credit-cards?ref=seealso">best secured credit cards</a>)</p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/christina-majaski">Christina Majaski</a> of <a href="http://www.wisebread.com/bankamericard-secured-visa-card-helps-protect-you-from-identity-theft">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/first-national-bank-secured-visa-card-review">First National Bank Secured Visa Card Review</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/usaa-secured-card-platinum-mastercard-review">USAA Secured Card Platinum MasterCard Review</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/wells-fargo-secured-credit-card-review">Wells Fargo Secured Credit Card Review</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/citi-double-cash-rewards-card-pays-you-to-pay-off-your-debt">Citi Double Cash Rewards Card Pays You to Pay Off Your Debt</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/get-free-nights-with-ihg-rewards-club-select-credit-card">Get Free Nights with IHG Rewards Club Select Credit Card</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Credit Cards Bank of America credit card reviews secured card Wed, 06 May 2015 03:43:01 +0000 Christina Majaski 1406713 at http://www.wisebread.com The Power of the Customer in Banking http://www.wisebread.com/the-power-of-the-customer-in-banking <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/the-power-of-the-customer-in-banking" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="/files/fruganomics/imagecache/250w/blog-images/piggy-bank-aloft-iStock_000017688546Small.jpg" alt="piggy bank" title="piggy bank" class="imagecache imagecache-250w" width="250" height="159" /></a> </div> </div> </div> <p>We tend to think of banks as enormous monolithic institutions against which customers may bang their heads in frustration &mdash; but forget about enacting any real change. And anyone who has ever spent an interminable amount of time waiting on hold for a customer service representative who will fail to explain the surprise fee on your account and refuse to waive it could be forgiven for thinking the little guy will never make a difference.</p> <p>However, that familiar narrative of uncaring banking Goliath vs. powerless customer David got a pleasant shock in November 2011. That was when Bank of America backed down from their proposed <a href="http://www.washingtonpost.com/business/economy/bank-of-american-drops-debit-card-fee/2011/11/01/gIQADvugcM_story.html">$5 monthly fee for debit card usage</a>. Their reason for canceling the proposed fee? Incredible customer backlash that included everything from a 300,000-signature petition to tens of thousands of Bank of America customers threatening to leave the bank. (See also: <a href="http://www.wisebread.com/why-i-like-big-banks">Why&nbsp;I Like Big&nbsp;Banks</a>)</p> <p>Apparently, the little guy has more power than we thought.</p> <p>Banking is just like any other retail business &mdash; they need to keep their customers happy. In banking, the CEOs may be accountable to their shareholders, but they depend upon their customers to stay in business.</p> <p>This means that customers have power in the face of unanticipated changes in the banking industry. Here is what you need to know about how banks make their unpopular decisions, and what we, as customers, can do about it.</p> <h2>The Straight Economic Model</h2> <p>For the most part, banks are pretty unsubtle and straightforward institutions. If they see that they will be losing revenue in one area, they will try to make up for it elsewhere.</p> <p>This is what happened with Bank of America in 2011: The Durbin Amendment to the Dodd-Frank Act was placing limits on the amount that banks could charge retailers each time a debit, credit, or gift card is used. That fee &mdash; familiarly known as the swipe fee &mdash; had previously been unregulated, but the Durbin Amendment placed caps on the amount that retailers will have to pay for each swipe.</p> <p>While these swipe fees are nominally instituted to pay for fraud protection and transactional costs, they have been an enormous income generator for banks. Bank of America in particular was bringing in <a href="http://www.nerdwallet.com/blog/banking/durbin-amendment-explained/">$3 billion per year</a> in profit from swipe fees. When the Durbin Amendment went into effect, the bank&rsquo;s top brass wanted to find a way to make up for their lost income &mdash; hence the proposed $5 per month debit card usage fee. It was simply a straight economic decision &mdash; replace lost income with a small fee, spread out over every cardholder.</p> <p>Of course, we all know what happened next. The idea of consumers suddenly having to pay a fee to use their card was infuriating &mdash; to the point where consumers decided to <a href="http://www.wisebread.com/how-to-switch-banks">switch banks</a>, publicly decry Bank of America, and basically make it clear that the company would lose more money by implementing this fee than they would lose by dropping it.</p> <p>What happened was a failure on the part of Bank of America to understand behavioral economics &mdash; where money and emotion intersect. By looking at everything as a straight financial decision, they shot themselves in the foot. <a href="http://businessjournal.gallup.com/content/152156/matters-banking-customers.aspx?version=print">Dr. Dennis Jacobe</a>, the Chief Economist for Gallup, put it this way &mdash; &ldquo;unfortunately, this finance-focused approach to replacing the bank's lost revenue ignored some of the basic tenets of behavioral economics. From a behavioral economics perspective, one of the worst things a company can do is to begin charging a new fee for a service that had previously been free.&rdquo;</p> <h2>The Price-Leader Strategy</h2> <p>The other big mistake Bank of America made was in employing the price-leader strategy when introducing this fee. This is a tactic wherein one major player in an industry changes a price or announces a new fee, and the rest of the industry simply follows suit.</p> <p>This tactic can work very well. For instance, the airline industry often uses it. One airline will announce that it will be charging for checked bags, and suddenly every airline is charging for them. Customers grumble and pay the new fees, because it&rsquo;s almost impossible to switch to a different airline and avoid them.</p> <p>However, in the case of Bank of America&rsquo;s monthly fee, other banks were not necessarily willing to jump on that train. Part of the reason for this had to do with the atmosphere of distrust toward banks in fall of 2011 &mdash; this was, after all, just about the same time the Occupy Wall Street movement started gaining traction.</p> <p>As a result, Bank of America found themselves in the position of pricing themselves out of competition, and they quickly had to back down.</p> <h2>The Power of the Customer</h2> <p>When it comes down to it, customers ultimately have the power to decide if they will play by the rules the banks are setting. The Bank of America fee debacle was hardly the first time that customers just said no to a proposed fee change. In the mid-90s, banks tried to charge customers for <a href="http://www.nytimes.com/1995/04/27/business/need-a-teller-a-big-bank-plans-3-fee.html">teller transactions</a>, hoping to entice them to use ATMs and the new-at-the-time <a href="http://www.wisebread.com/4-things-to-consider-before-you-open-an-online-savings-account">online banking opportunities</a>, thereby reducing overhead costs. Customers were horrified at the proposed fees and made it clear they would not stand for it. The banks that prospered were the ones that repackaged their products and found ways to offer discounts for not using tellers, rather than fees for using them.</p> <p>In that case, as in the situation with Bank of America, customers voted with their feet. Their disgust at the proposed changes made it worthwhile to change banks. Making unpopular fee decisions literally cost the banks money in lost customers.</p> <p>However, it&rsquo;s not enough for banks to keep their customers through apathy or lack of other choices. Banks have also found that keeping customers happy and engaged is an important part of growth. According to <a href="http://businessjournal.gallup.com/content/152156/matters-banking-customers.aspx?version=print">Dr. Jacobe</a>, &ldquo;Customers become engaged only when four emotional needs are met: they feel pride and passion for the brand they bank with, they believe the bank has integrity, and they're confident they'll always be treated well and fairly. It's financially imperative that banks provoke this response. Fully engaged retail banking customers are <em>much</em> more likely to say they intend to open a new account or take out a new loan.&rdquo;</p> <p>And since customer satisfaction is so important to the growth of banks, judicious use of complaints is one of the biggest weapons in the customer&rsquo;s arsenal. Making it clear to your bank that you are unhappy with their service can potentially bring about change &mdash; or at the very least, prepare your bank for your imminent departure.</p> <h2>The Bottom Line</h2> <p>It may feel as though the big banks hold all the cards, but we all need to remember that they really do need us more than we need them &mdash; as it is theoretically possible to keep your life savings in your mattress, while they simply cannot operate without customers.</p> <p>Banks may have always followed the straight finance approach to keeping their revenues high, but they are beholden to their customers. When that straightforward approach ticks off their customers, they will need to find new methods, or else risk losing their most important asset &mdash; us.</p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/emily-guy-birken">Emily Guy Birken</a> of <a href="http://www.wisebread.com/the-power-of-the-customer-in-banking">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-2"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/charged-with-an-overdraft-fee-get-your-money-back">Charged With an Overdraft Fee? Get Your Money Back!</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/12-annoying-bank-fees-and-how-to-avoid-them">12 Annoying Bank Fees and How to Avoid Them</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/7-ways-to-pick-the-bank-thats-right-for-you">7 Ways to Pick the Bank That&#039;s Right for You</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-get-rid-of-and-avoid-late-fees">How to Get Rid of and Avoid Late Fees</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/behind-the-times-i-learn-about-keep-the-change">Behind the Times - I learn about Keep the Change</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Banking bank fees Bank of America customer service Tue, 04 Dec 2012 10:36:49 +0000 Emily Guy Birken 959540 at http://www.wisebread.com Get Help With Your Underwater Bank of America Mortgage http://www.wisebread.com/get-help-with-your-underwater-bank-of-america-mortgage <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/get-help-with-your-underwater-bank-of-america-mortgage" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="/files/fruganomics/imagecache/250w/blog-images/177362360_85ce49aa97_b.jpg" alt="house underwater" title="house underwater" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>In February 2012, the major lenders in the United States struck a <a href="http://www.nationalmortgagesettlement.com/">deal with the government</a> to avoid prosecution for improper processing of foreclosures. In order to reduce its share of penalties, Bank of America has revealed recently that it is willing to forgive the principal of many mortgages so that the borrowers will no longer be underwater. Some borrowers may qualify for reductions of $100,000 or more. Here are the details of the program and how you can find out if you qualify. (See also: <a href="http://www.wisebread.com/six-options-if-youre-underwater-on-your-mortgage">6 Options If You're Underwater on&nbsp;Your Mortgage</a>)</p> <p>This new principal reduction program is a part of the <a href="http://homeloanhelp.bankofamerica.com/en/nhrpannouncement.html ">National Homeownership Retention Program </a>rolled out by Bank of America since Obama's Home Affordable Modification Program. The borrowers that will receive help must meet these qualifications:</p> <ul> <li>The borrower must be at least 60 days late on payments as of January 31st, 2012. So people who have been paying their loans on time do not qualify unless they can demonstrate that they will default soon due to a rate reset on an ARM. Borrowers who are current also need to submit documentation showing financial hardship.<br /> &nbsp;</li> <li>The amount owed must be more than 120% of the current value of the house.<br /> &nbsp;</li> <li>The loan cannot be a Fannie Mae or Freddie Mac Loan. Only loans owned by Bank of America or private investors are eligible.<br /> &nbsp;</li> <li>The property must be owner-occupied.</li> </ul> <p>The maximum amount Bank of America will forgive is 30% of the remaining principal or the difference between the current value and the loan, whichever is smaller. For example, if a house is currently worth $150,000 and the loan is $180,000 then they will reduce the loan to $150,000. If a house is worth $150,000, but the loan is $250,000, then they will only reduce the loan to $175,000, since that is a 30% reduction on the loan. So a borrower in the second situation will still be underwater, but it would still be a significant improvement to pay interest on 70% of the previous principal.</p> <p>The principal forgiveness is also spread out over three or five years, depending on the individual case. From the examples given by the bank's site, it looks like they will take future appreciation of the home into consideration and reduce less of the principal if the <a href="http://www.wisebread.com/divining-your-homes-value-the-quick-and-dirty-way">house's value</a> goes up. It's unclear what would happen if the house's value goes down.</p> <p>The program ends on December 31st, 2012, so borrowers that possibly qualify should go to Bank of America's site right away and see if they are eligible. The website allows you to type in your mortgage account number to see your options. You can also click the <a href="http://homeloanhelp.bankofamerica.com/en/nhrpannouncement.html">FAQ tab on Bank of America's page</a> for more details. Bank of America says it will help 200,000 people with this program. As part of the National Mortgage Settlement the other major lenders are also supposed to offer more principal reductions, but Bank of America's site is the only one with clear guidelines so far.</p> <p><em>Are you a Bank of America customer who will benefit from this? Do you think this program will be more successful than previous attempts to curb foreclosure? </em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/xin-lu">Xin Lu</a> of <a href="http://www.wisebread.com/get-help-with-your-underwater-bank-of-america-mortgage">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-3"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/principal-forgiveness-the-new-bofa-mortgage-deal">Principal Forgiveness: The New BofA Mortgage Deal</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/12-crucial-things-homebuyers-overlook-at-open-houses">12 Crucial Things Homebuyers Overlook at Open Houses</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/mortgage-application-declined-here-s-how-to-respond">Mortgage Application Declined? Here’s How to Respond</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/five-reasons-not-to-apply-for-a-loan-modification-in-the-home-affordable-modification-program-hamp">5 Reasons Not to Apply for a Loan Modification in the Home Affordable Modification Program (HAMP)</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/when-is-the-best-time-to-lock-in-a-mortgage-rate">When Is the Best Time to Lock in a Mortgage Rate?</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Real Estate and Housing Bank of America mortgage principal reduction Fri, 30 Mar 2012 10:24:07 +0000 Xin Lu 915042 at http://www.wisebread.com Is Bank of America’s $5 Monthly Debit Card Fee Just the Beginning? http://www.wisebread.com/is-bank-of-america-s-5-monthly-debit-card-fee-just-the-beginning <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/is-bank-of-america-s-5-monthly-debit-card-fee-just-the-beginning" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="/files/fruganomics/imagecache/250w/blog-images/boa_atm2.jpg" alt="Man at a Bank of America ATM" title="Man at a Bank of America ATM" class="imagecache imagecache-250w" width="250" height="157" /></a> </div> </div> </div> <p>In a word, yes.</p> <p>Consider this phrase &mdash; &ldquo;Take money from businesses, they&rsquo;ll just turn around and take it from the customers.&rdquo;</p> <p>I&rsquo;ve heard that, and many variations of it, several times over the last few years. Now it looks like it&rsquo;s coming true for all of us.</p> <p>It&rsquo;s no secret that banks make a lot of their money from fees. Whether it&rsquo;s late payment penalties, interest rate hikes, ATM fees, money-wiring transactions, or any number of other transactions, fees are the bread and butter of the banking industry.</p> <p>These fees seemed to be going away, or getting vastly reduced, as banks tried to outdo each other in the battle for your hard-earned money. Free checking was suddenly the norm, and then banks would offer even more incentives (free iPods, luggage, shotguns, and good old cash) in an effort to get you on board.</p> <p>Of course, nothing lasts forever, and the free checking benefits we&rsquo;ve all enjoyed for many years have started to suffer the death of a thousand cuts. Slowly but surely, free checking is going away and being replaced by certain terms and conditions that give you certain free features IF you maintain a set minimum balance, have a significant number of direct deposits, and so on.</p> <p>In fact, you can actually avoid Bank Of America&rsquo;s new debit card fee if maintain a minimum balance of $20,000. (Once again, we see wealth being rewarded.) You can also avoid the fee by simply using your debit card as an ATM card only. (See also: <a href="http://www.wisebread.com/4-ways-to-beat-debit-card-fees">4 Ways to Beat Debit Card Fees</a>)</p> <h3>So Why Did This New Fee Appear?</h3> <p>Well, it&rsquo;s a direct result of a bill passed by congress that was supposed to save consumers money. Of course, it never works out that way, does it?</p> <p>Banks have been making billions of dollars on swipe fees for many years now. These are<a href="http://www.wisebread.com/debit-or-credit-which-one-should-you-choose-at-the-checkout"> fees charged to the merchant every time you swipe your debit card,</a> and they average around 44 cents per swipe.</p> <p>Or at least, they did. Merchants lobbied against the fees and won, saying that by lowering the price of these swipe fees, we, the customers, would get lower prices on goods and services.</p> <p>But when they passed the law, they didn&rsquo;t think of the ramifications of the ripple effect. It&rsquo;s also known as &ldquo;unintended consequences.&rdquo; By cutting these fees in half, billions of dollars have been taken away, annually, from the banks. Ouch. You know as well as I do that those losses are not going to be absorbed by the banks. The CEO, Brian Moynihan, isn&rsquo;t going to pay for it out of his <a href="http://www.huffingtonpost.com/2011/02/01/bank-of-america-ceo-pay_n_816789.html ">$950k salary or his $9 million in stock awards</a>.</p> <p>So who pays? You&rsquo;ve guessed it &mdash;&nbsp;we&rsquo;re the ones who pick up the tab. And the $5 per month debit card charge is only just the beginning; I guarantee it.</p> <p><img width="233" height="350" alt="" src="/files/fruganomics/u921/BOA%20debit%20card.jpg" /></p> <h3>Bank of America Is Not the Only One Raising Fees</h3> <p>JP Morgan Chase customers in Wisconsin have felt the pinch, with $3 per month being deducted for debit card usage. Sun Trust (Georgia) and Regions Financial Corp. (Alabama) are also charging $4 to $5 per month.</p> <p>And Wells Fargo recently announced that it will test a $3 per month debit card fee in five states &mdash; Oregon, New Mexico, Nevada, Georgia, and Washington.</p> <h3>What Does the Future Hold?</h3> <p>Fees. Lots of them.</p> <p>Right now, with the financial institutions just starting to roll out fees, you obviously have the <a href="http://www.huffingtonpost.com/2011/09/30/bank-of-america-fee_n_992623.html?ir=Business">option to walk away</a>. But that won't be an option for long. If you want the conveniences that a typical bank offers, you&rsquo;re going to have to start paying for them. Banks across the U.S. will follow Bank Of America&rsquo;s lead, because they&rsquo;re losing out if they don&rsquo;t. And any banks who don&rsquo;t charge the fee will no doubt find other ways to make up the losses. You&rsquo;ll see free checking replaced by checking that requires maintenance fees. You&rsquo;ll get dinged if you go below a certain balance, or if you make more than a set number of purchases with your debit card each month.</p> <p>There will be tiered plans &mdash; $3 a month for 50 swipes, $15 for unlimited swipes. And why not? The cell phone industry is all about tiered pricing. And you&rsquo;ll have to pay for the privilege of online banking, automatic bill payments, even checking your balance on your phone. This is the future, and if everyone&rsquo;s doing it, so we really don&rsquo;t have an option other than to remove ourselves from the banking system and go back to the stone-age. Anyone for a mattress stuffed with cash?</p> <h3>And What About the Merchants Who Said They&rsquo;d Cut Prices?</h3> <p>That&rsquo;s a tough one to prove. Walmart has been rolling back prices for years, long before this bill came into effect. <a href="http://www.wisebread.com/tips-for-perimeter-perusing-at-target">Target</a>, Home Depot, Best Buy, you name it &mdash; they constantly claim to be slashing prices, so how can we tell if those savings are being passed on to us?</p> <p>Truth is, as consumers, we can&rsquo;t. I&rsquo;m not saying that the big corporations are going back on their word to pass on savings to the customers, I just can&rsquo;t prove that they are. I suspect the reality is somewhere in the middle, with some savings being passed on to us, and some money going back into the wage packets of CEOs and senior management.</p> <p>Sadly, it&rsquo;s just another example of the consumer being at the bottom of the hill&hellip;and we all know what rolls down hill.</p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/paul-michael">Paul Michael</a> of <a href="http://www.wisebread.com/is-bank-of-america-s-5-monthly-debit-card-fee-just-the-beginning">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-4"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-simplifying-your-accounts-can-improve-your-finances">How Simplifying Your Accounts Can Improve Your Finances</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-best-prepaid-debit-cards">5 Best Prepaid Debit Cards</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/travel-and-money-using-prepaid-travel-cards">Travel and Money: Using Prepaid Travel Cards</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/credit-cards-vs-debit-cards-a-comprehensive-comparison">Credit Cards vs. Debit Cards: A Comprehensive Comparison</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-switch-banks">How to Switch Banks</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Banking Credit Cards Financial News ATM Bank of America banking fees debit card fees Fri, 07 Oct 2011 10:36:34 +0000 Paul Michael 733796 at http://www.wisebread.com Principal Forgiveness: The New BofA Mortgage Deal http://www.wisebread.com/principal-forgiveness-the-new-bofa-mortgage-deal <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/principal-forgiveness-the-new-bofa-mortgage-deal" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="/files/fruganomics/imagecache/250w/blog-images/fish%20underwater.jpg" alt="fish under water" title="underwater" class="imagecache imagecache-250w" width="250" height="169" /></a> </div> </div> </div> <p>Starting next month (May 2010) or as soon as its operationally ready, Bank of America may reduce principal balances on certain mortgages of deeply underwater loans. This move expands the scope of its National Homeownership Retention Program (NHRP), which was established to make amends for predatory lending practices by Countrywide Financial, which Bank of America acquired in 2008.</p> <p>The overview of the <a href="http://homeloanhelp.bankofamerica.com/en/nhrpfactsheet.html">original program</a> on Bank of America&rsquo;s website is skimpy on details. A more detailed description of the <a href="http://newsroom.bankofamerica.com/index.php?s=43&amp;item=8662">new-and-improved NHRP</a> indicates that eligible borrowers consist of those who:</p> <ul> <li>Purchased a primary residence by taking out a subprime mortgage, Pay Option ARM (Adjustable Rate Mortgage), or Prime 2-year Hybrid ARM loan from <strong>Countrywide</strong> on or before January 1, 2009;<br /> &nbsp;</li> <li>Are now 60 days or more delinquent on the mortgage loan;<br /> &nbsp;</li> <li>Have a principal balance that is 120% or more of the market value of the home (LTV).</li> </ul> <p>Loans are to be modified through 1) principal forgiveness and 2) interest rate reductions. The hoped-for result is a monthly mortgage payment that is affordable according <a href="http://www.wisebread.com/five-reasons-not-to-apply-for-a-loan-modification-in-the-home-affordable-modification-program-hamp">HAMP guidelines</a> AND a fully amortizing loan so that borrowers can avoid the scenario of making payments for decades&nbsp;but&nbsp;never shrinking loan balances.</p> <p>In some cases, the principal reduction isn&rsquo;t really about lowering the original loan balance to reflect market value but rather undoing the harm caused by interest capitalization associated with negatively amortizing loans. (In plainer language, if you owe more now than you borrowed a few years ago &mdash; because interest was added to your loan balance &mdash; then help might be on its way.)</p> <p>But forgiveness isn't quick, simple, and all-encompassing. The following conditions may apply:</p> <ul> <li>Principal reductions will be based on borrower performance over a period of 5 years<br /> &nbsp;</li> <li>Loan term will be extended to 40 years (rather than a standard 30 years)<br /> &nbsp;</li> <li>Arrearage (past obligations not paid) will be capitalized (added to the outstanding loan balance)<br /> &nbsp;</li> <li>Principal amounts <em>not forgiven</em> (because there are limits to forgiveness, up to 100% LTV) will be &ldquo;non-interest bearing and a balloon payment of the forbearance amount will be due on the maturity date, upon sale of the property, or upon payoff of the interest bearing balance.&rdquo; (according to the <a href="http://www.mass.gov/Cago/docs/press/2010_03_24_countrywide_agreement_attachment_2.pdf">Final Judgment by Consent</a> &nbsp; PDF indicating the settlement of a complaint filed by the Attorney General's Office of Massachusetts).</li> </ul> <p>The program (both the original and enhanced NHRP) is part of a settlement of lawsuits filed by Attorney Generals of multiple states, such as:</p> <ul> <li>Alaska <a href="http://www.law.state.ak.us/pdf/consumer/072309-CountrywideAlert.pdf">settlement</a> (PDF) <br /> &nbsp;</li> <li>California <a href="http://ag.ca.gov/newsalerts/release.php?id=1618&amp;year=2008">news release</a><br /> &nbsp;</li> <li>Louisiana <a href="http://ag.state.la.us/Article.aspx?articleID=328&amp;catID=2">basic info</a><br /> &nbsp;</li> <li>Massachusetts <a href="http://www.mass.gov/?pageID=cagopressrelease&amp;L=1&amp;L0=Home&amp;sid=Cago&amp;b=pressrelease&amp;f=2010_03_24_countrywide_agreement&amp;csid=Cago">press release on settlement</a><br /> &nbsp;</li> <li>Rhode Island <a href="http://www.ri.gov/press/view.php?id=9408">press release</a><br /> &nbsp;</li> <li>Washington <a href="http://www.atg.wa.gov/countrywide.aspx">website on Countrywide loans</a></li> </ul> <p>Check the website of your state's Attorney General's office for details on loan programs that may relate to your situation. To see if you are eligible for National Homeownership Retention Program, check <a href="https://homeloanhelpworksheet.bankofamerica.com/nhrp/default.aspx">Bank of America's website</a>.</p> <p>Note that &ldquo;Countrywide has <strong>initiated proactive outreach</strong> to eligible borrowers,&quot; which seems to mean &quot;we&rsquo;ll call you, don&rsquo;t call us.&rdquo; However, the legal agreements require assistance to a certain number of borrowers so Bank of America needs to find people to help. Borrowers can take action rather than waiting for a phone call.</p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/julie-rains">Julie Rains</a> of <a href="http://www.wisebread.com/principal-forgiveness-the-new-bofa-mortgage-deal">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-5"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/get-help-with-your-underwater-bank-of-america-mortgage">Get Help With Your Underwater Bank of America Mortgage</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/low-interest-rates-do-not-make-homes-affordable">Low Interest Rates Do Not Make Homes Affordable</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/a-mortgage-crisis-solution">A Mortgage Crisis Solution</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/countrywide-tried-to-steal-my-parents-money-how-you-can-avoid-being-a-victim-of-mortgage-servicing-f">Countrywide tried to steal my parents&#039; money - How you can avoid being a victim of mortgage servicing fraud</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/12-crucial-things-homebuyers-overlook-at-open-houses">12 Crucial Things Homebuyers Overlook at Open Houses</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Financial News Real Estate and Housing Bank of America countrywide mortgage mortgage loan modification principal reduction Wed, 28 Apr 2010 13:00:04 +0000 Julie Rains 48221 at http://www.wisebread.com I Don't Love Capital One - How to Get a Lower APR, or Possibly Not http://www.wisebread.com/i-dont-love-capital-one-how-to-get-a-lower-apr-or-possibly-not <p><img src="/files/fruganomics/wisebread_imce/creditcard_Sm.jpg" alt=" " width="321" height="233" /></p> <p>I knew there was a reason that I chose <strong>capitalone-bites-the-big-one772</strong> as my log in name for my online credit card account. It&#39;s because, well, Capital One bites. I&#39;m a good customer of Capital One; I keep a revolving balance that should make them happy, and I pay my bill religiously.</p> <p>Now, I don&#39;t have the best credit history. A few years ago, when I was unemployed for a few months, I had to <a href="http://www.kimberlycredit.com/">consolidate a few credit cards</a>. Also, I totally went crazy back in college and rang up some terrible balances paying for <a href="/can-i-conquer-my-vanity-for-the-sake-of-my-sanity">other people&#39;s stuff</a>. Despite this, I always paid off the high balances, and because I&#39;ve been so responsible since, and because I make a decent income, I have a good credit score, much better than the American average. </p> <p>Despite this, I still pay roughly 17% APR on my Capital One credit card.</p> <p>So last Friday, when I heard NPR&#39;s Morning Edition giving totally unoriginal advice about how to lower your credit card costs, I thought, <em>I should try that</em>. </p> <p>If you don&#39;t feel like <a href="http://www.npr.org/templates/story/story.php?storyId=7299407">listening to the broadcast</a>, I&#39;ll give you the gist: <em>Paying a high APR? Why not call the company and ask them to lower your interest rate? They&#39;ll probably do it. If they don&#39;t, threaten to transfer your balance to another card! Or talk to the manager!</em></p> <p>Lots of people seem to think that you can <a href="http://www.amazon.com/Talk-Your-Credit-Card-Debt/dp/0964840154">get out of debt with mere words</a>. I&#39;ve actually tried this method before, and Capital One totally called my bluff. </p> <p>&quot;I&#39;ll transer my balance!&quot;, I shrieked to the customer service rep 2 years ago. When I applied for another card, I got rejected. Mind you, I wasn&#39;t making much money at the time, but still, maybe Capital One probably has a little note on my file that says &quot;Ignore requests for lower interest rate - she can&#39;t get one. Bwahahahaha!&quot;. </p> <p>But, I reasoned, I make good money <em>now</em>. I have a <strong>mortgage</strong>. Capital One will have to respect me. Just to be on the safe side, I applied for a credit card with 0% APR on balance transfers for the first 12 months, and 7.9% thereafter. I only have a couple thousand to pay off, but still, the APR makes a difference to me. And besides, I&#39;d never missed a payment, never been late, and long ago stopped adding to my credit debt. So, they&#39;d be sure to oblige this time, right?</p> <p>As usual, Capital One managed to disappoint. I was informed that &quot;There isn&#39;t another interest rate that we can apply to your card&quot; as though 1 and 7 were the only numbers on her keypad, and bygummit, they could only be entered in that exact order. I asked to speak to a manager, and an equally unmovable person got on the line to inform me that there was no way in which my rate could be lowered.</p> <p>&quot;I&#39;ll transfer my balance!&quot;, I shrieked, experiencing a keen sense of deja vu. The rep was unconcerned.</p> <p>Sadly, it seems like <a href="http://money.aol.com/smoney/credit/canvas3/_a/plastic-penalties/20060928152709990001">I&#39;m not alone</a> in my rejection.</p> <p class="blockquote">Negotiating Power Back in 2003, a study by the U.S. Public Interest Research Group, a Washington, D.C., a consumer advocacy group, found that 56% of the consumers who called their credit-card companies to ask for a lower interest rate were able to get it within five minutes. <em><strong>That may not be as easy today</strong></em>, says US PIRG consumer program director Ed Mierzwinski. &quot;They are being much more difficult because they&#39;re trying even harder to squeeze the last dollar out of your pocket,&quot; he says. &quot;But if you&#39;re a good customer you should understand they don&#39;t want to lose you because the cost of acquiring new customers is very high.&quot;</p> <p>I did apply for a new credit card, and was accepted, but then I read this:</p> <p class="blockquote">But be wary of balance transfer fees, which lately have also been on the rise.... While most fees used to be 3% of the transferred balance, up to a cap of $50 to $75, many card issuers now charge 4% of the balance with a cap of $90, Arnold says. Notably, Bank of America recently eliminated the cap on its 3% fee. So on a $10,000 transfer, you&#39;d be hit with a $300 charge.</p> <p><a href="http://blog.washingtonpost.com/thecheckout/2006/07/borrowers_beware_of_balance_tr.html">Also</a>:</p> <p class="blockquote">What&#39;s particularly troubling... is that most consumers probably won&#39;t realize there&#39;s no maximum fee because it&#39;s completely absent in the fine print. Up to now, the balance-transfer fee listed in the terms and conditions usually notes a maximum, but in some of the latest offers, there&#39;s absolutely no mention of any maximum. And that could mean you may have to pay the entire 3 percent charge. Best advice: Call and ask about all balance-transfer fees, including maximums, before accepting any new card offer.</p> <p>This is important to note: when I applied for my credit card online, there was no immediate or obvious information about transfer fees. What was written was this:</p> <p class="blockquote">We include Transaction Fees when computing finance charges. Incurring Fees results in an APR exceeding 0% for the billing statement on which Fees appear. The Daily Periodic Rate (DPR) will remain 0% as disclosed.</p> <p>Is it just me, or is that wording not exactly straight-forward? </p> <p>Now, I could just pay off the credit card (this may seem logical to people whose brains are not addled by consumer greed and shoe lust). Using <a href="http://www.bankrate.com/brm/calc/creditcardpay.asp">Bankrate.com&#39;s credit pay down calculator</a>, I determined that by paying my minimum payment every month (which is what Capital One helpfully hints that I should do when I pay my bill online) it will take me 43 months to pay off a debt of $2500. If I pay $400 a month (tough, but doable), it will take me 7 months. </p> <p>But even in that case, Capital One still gets $300 in interest from me. </p> <p>Anyway, when I called and spoke to my new credit card company this morning, it turns out that my transfer fee for balances would amount to roughly $75. Which is much better than $300 going towards Capital One. I could then take my sweet time (11 months at $250 a month) to pay off the card, which would be easier to swing than $400 a month. </p> <p>So take THAT, Capital One! Take that. I&#39;m taking $300 out of your coffers and giving $75 to another company! Yes!</p> <p>It is a bitter victory indeed.</p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/andrea-karim">Andrea Karim</a> of <a href="http://www.wisebread.com/i-dont-love-capital-one-how-to-get-a-lower-apr-or-possibly-not">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-6"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/best-of-personal-finance-credit-where-credit-is-due-edition">Best of Personal Finance: Credit Where Credit Is Due Edition</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/your-interest-rates-are-about-to-go-up">Your Interest Rates Are About to Go Up</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-dirty-secrets-of-credit-cards">The Dirty Secrets of Credit Cards</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/debit-or-credit-which-one-should-you-choose-at-the-checkout">Debit Or Credit? Which One Should You Choose At The Checkout?</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-best-low-interest-rate-credit-cards">The Best Low Interest Rate Credit Cards</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Credit Cards Debt Management APR Bank of America Capital One credit card CSR debt lower interest rate MasterCard NPR VISA Mon, 12 Feb 2007 20:49:06 +0000 Andrea Karim 269 at http://www.wisebread.com Behind the Times - I learn about Keep the Change http://www.wisebread.com/behind-the-times-i-learn-about-keep-the-change <p><img src="/files/fruganomics/wisebread_imce/pennyjar_small.jpg" alt=" " width="141" height="160" /></p> <p>I tend to ignore most promotions that banks send my way. I use Bank of America for my primary checking account, and they often interrupt my online banking log-in to try to sell me on some kind of promotion, and it’s usually crap. </p> <p>So it was with Keep the Change – I just assumed that it was another little gimmick that wasn’t worth a second glance, and I would sigh heavily whenever the advertisement prevented me from immediately seeing my account balance when I logged into my online checking account. It wasn’t until a friend told me that she was participating that I started to pay attention. </p> <p>(Now, to show you just how out of it I am, Keep the Change launched in October 2005, and I’m blogging about it in January 2007. The fact that I know what a &quot;blog&quot; is should probably be surprising. Aren&#39;t you glad that I get paid fractions of pennies per day to give you financial advice?)</p> <p>Keep the Change works like an electronic version of a change jar, but a change jar that doubles the amount that you throw in there. You know how you hear that when you pay cash for something, if you ALWAYS put your leftover change in a jar, at the end of a year, you’ll have several hundred dollars saved up? That’s true if you are the cash-paying type – I’m not, although that may change over time. I tend to use my debit card for everything. And this is where Keep the Change comes in.</p> <p>Keep the Change pretty much works like a change jar. Every time you pay for something with your B of A debit card, Bank of America will round the total up to the next dollar (no matter what the amount) and deposit the difference in your savings account. So, if your morning latte comes to $3.13, an extra $0.87 is taken from your checking and deposited into your savings account.</p> <p>So, initially, they take extra money out of your checking account and deposit it into savings. This isn’t really revolutionary, but it’s not a bad idea. What makes it a GOOD idea is that, for the first 90 days, Bank of America will 100% MATCH those rounded-up cents. After that, they’ll match 5% of what is transferred into your savings.</p> <p>That’s free money. If you’re already a Bank of America customer, and you’re like me, and you tend to ignore most promotional offers because you don&#39;t trust your bank, and you&#39;re not enrolled, then you should consider it.</p> <p>From the Bank of America website:</p> <p class="blockquote">Earn a promotional match up to <strong>$250 per anniversary period</strong> for each checking account with the Keep the Change savings service. You will not receive the matching funds for: a) credits or other adjustments related to POS purchases, such as those for purchases that are cancelled or returned; b) purchases of cash-like items, such as money orders, traveler’s checks, foreign currency, cashier’s checks, gaming chips, and other similar instruments and things of value; c) Account funding transactions including transfers to open or fund deposit, escrow, or brokerage accounts and purchases of stored value cards. We may terminate the matching promotion at any time without notice.</p> <p class="sub-heading">Pros</p> <ul> <li>It makes balancing your checkbook a lot easier. Whole numbers = simple accounting.</li> <li>You save money automatically, without thinking about it.</li> <li>Did I mention that they MATCH the savings earned through the program?</li> <li>Earn as much as you can by tipping – when I go out to eat (every night), I add my tip so that my total comes to exactly one cent over a whole dollar amount - $29.01, for example. That way, Bank of America has to give me $0.99, when the time comes. </li> <li>It appears as though you can go ahead and transfer the money out of savings (although this sort of defeats the purpose of saving the money, and you won’t earn as much interest as if you left it there, but in a pinch, you can grab those funds).</li> <li>You can buy stuff and return it, and still keep the change. There are some restrictions. See the bottom of this <a href="http://www.bankofamerica.com/promos/jump/ktc/" target="_blank">page</a>.</li> </ul> <p class="sub-heading">Cons</p> <ul> <li>There are some catches – if you overdraw your account for a day, you won’t get matched for that day. Only Bank of America checkcards count, so you won’t get it with a regular co-branded Visa.</li> <li>You have to report the promotional matching funds to the IRS (form 1099).</li> <li>They don’t start matching right away. In fact, it might be hard to determine exactly when they start matching. According to the CSR that I spoke to, they will match your funds at the end of your anniversary year – that is, on the anniversary of the day that you opened your account. The matching is fuzzy. I’ve talked to two Customer Service Reps who claim that there is no limit to the amount of money that Bank of America will match. However, on this <a href="http://www.bankofamerica.com/promos/jump/ktc/" target="_blank">page</a>, it seems like there is a $250 matching limit. </li> <li>I don’t think it’s really worth it to open a checking and savings account with Bank of America if you don’t already have one. You don’t get great interest rates on savings, and other banks are more than happy to give you better promotional deals.</li> <li>You only make a good deal of money on this if you spend like I do, on tons of little items, many times a day. I do this, but I’m trying hard not to, and trying not to makes it difficult to earn as much money from Bank of America. The other thing that bugs me is the knowledge that banks don’t usually lose money on promotions – there’s a reason why they can afford to give you some free money, and that’s because you give them free money all the time. </li> </ul> <p>I&#39;ve been enrolled in Keep the Change for a little over a month, and I&#39;ve set aside a little over $70. Which means that Bank of America eventually has to give me $70, at least. Hey, it&#39;s not a lot, but it&#39;s a manicure and pedicure, right there.</p> <p>I should add that if anyone has gotten screwed over by this promotion, please do let me know. I&#39;d love to have something to scream about. </p> <p>&nbsp;</p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/andrea-karim">Andrea Karim</a> of <a href="http://www.wisebread.com/behind-the-times-i-learn-about-keep-the-change">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-7"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/get-25-free-for-opening-a-savings-account-with-5-05-interest">Get $25 FREE for opening a savings account with 5.05% interest. - UPDATED</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/this-post-really-suk-kuks-examining-islamic-finance">This Post Really Suk-kuks: Examining Islamic Finance</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/best-ways-to-count-and-cash-in-your-change">Best Ways to Count (and Cash in) Your Change</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-ways-to-boost-your-odds-of-retiring-early">5 Ways to Boost Your Odds of Retiring Early</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/10-investing-lessons-you-must-teach-your-kids">10 Investing Lessons You Must Teach Your Kids</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Banking Investment Bank of America change interest Keep the Change promotions savings Thu, 01 Feb 2007 22:19:21 +0000 Andrea Karim 244 at http://www.wisebread.com