When I had trouble with my Chase checking account several months ago and decided it was time to move my money to a local bank, I had no idea I was part of a big movement. But a couple of weeks ago, I noticed my website was getting a lot of hits from people searching for MoveYourBank.info. Being the curious person that I am, I decided to check the site out.
It turns out the site, which is officially MoveYourMoney.info (moveyourbank.info redirects to the Move Your Money site), is part of a grass roots effort to encourage people to move their money from big Wall Street Banks to smaller community banks. According to the site’s about page, the idea for the movement got started right before Christmas.
JUST BEFORE CHRISTMAS, a few friends were having dinner wondering what personal actions they could take to help limit the power of the big banks and create a more sane, stable financial system. How, they wondered, could they help end the era of Too Big To Fail? The financier at the table recommended that everyone could move their money out of the Wall Street banks and into community banks. Community banks are typically more conservative about how they manage their money, they’re more closely connected to the people and businesses who live near them, and they’re more inclined to make loans they know will get paid back. In other words, they have the values that more people would want banks to have.
Having recently moved my money from Chase to a local community bank, I couldn’t agree more. There are advantages to keeping your money at a local bank.
My biggest frustration in dealing with Chase is that there seemed to be no room to treat each customer as an individual. I was customer for 14 years with an impeccable record. Yet when my mortgage company bounced a check to me, causing my account to be overdrawn, the people at Chase were bound by the bank rules and had to charge me over $200 in overdraft fees, despite the unusual circumstance.
Over and over again I was told, “Those are the rules. There’s nothing more I can do.” Fortunately I managed to get the email address of someone way up the line, who was eventually able to reverse all the fees. It took several days and many hours on the phone, though.
When I moved my money to South Valley Bank and Trust, a local bank, the first thing I asked was how overdrafts were handled. I was told they process all transactions manually, and if your account is about to go into the red, they call you and give you a chance to bring in a deposit. How’s that for service?
I already mentioned my frustration with the amount of time it took Chase to resolve my problem. That’s not unusual with a big bank. To see further examples, one only need look at the comments on my post about the Taylor, Bean, & Whitaker mortgage fiasco.
Many of the old Taylor, Bean, & Whitaker mortgages were transferred to Bank of America after TBW declared bankruptcy. Some of the transfers went smoothly, including mine. Some however, didn’t transfer well at all.
An anonymous commenter wrote the following:
Well, my boat finally sank. I made two payments to TBW in July and August. The checks cleared but they did not post it to my account. I never received an answer as to where the funds went to. As soon as my account was transferred to Bank of America they were too eager to foreclose on my ‘two missed’ payments. I explained the situation and had proof that TBW took my money but Bank of America wanted their money too. After making an additional 2 months worth of payments, plus late fees(which they had promised not to charge), plus one year’s insurance and taxes(which are in escrow account) I can’t do it. I tried to hold on for as long as possible, but it’s too much out-of-pocket costs. Now they are charging me $25 per day late fee(amounting to $750/month) in addition to my monthly payment for the TBW payments they claimed were late. I’ve tried finding a lawyer to help but no one will touch it because I can’t afford a $10,000 retainer and they don’t want to go up against the FDIC or TBW. I hope it works out better for the rest of you. I prayed for help every day, maybe it will help someone else. As for me, I’ve lost everything I own because of Taylor Bean. Good luck to the rest of you.
I can’t help but think if the bank that took over the account were a smaller bank with more personal service, this situation may have had a better ending.
That’s not the only bad Bank of America story I’ve heard recently. Allegedly, Bank of America foreclosed on the wrong house, costing a New Bedford, MA couple damage to their vacation home, loss of a renter, and a huge headache.
I realize that no bank, big or small, is immune to mistakes, though that’s a pretty big one. However, I wonder if a mistake like that would have been taken care of more quickly at a smaller bank, where it’s easier to get in touch with someone who can actually help you.
My mom’s experience in dealing with a local bank is that they resolve problems quickly. She had a situation where her employer deposited money into her account that they shouldn’t have. She unwisely, but for the right reasons, transferred the money to her savings account for safekeeping, while she tried to find out from her manager what had happened. In the meanwhile, her employer reversed the transaction, causing her account to become overdrawn.
Within 5 minutes of talking to her bank manager, all of her overdraft fees were reversed, and she didn’t have to pay a dime in fees. Moving the money to her savings account wasn’t the wisest decision, but she was a longtime customer, and the bank apparently felt that good customer service was more important than making a couple hundred dollars in overdraft fees.
The bottom line is that both big banks and local banks will serve you well under ordinary circumstances. After all, I was a happy Washington Mutual/Chase customer for 14 years, and that’s a long time.
The difference between the two types of banks becomes clear when there’s a problem. That’s when local banks win, hands down. Logistically, it’s just a lot more difficult to cut through the red tape of a big bank to reach a resolution, than it is to contact someone at a local bank that can help you get the answers you need. Unfortunately, it’s often when you’re having problems that the stress level is high and you don’t have the time, money, or energy to deal with hours on the phone, trying to reach someone who can help you.
For that reason, I’m totally on board with the movement to move your money to a local bank or credit union. I’m glad I moved my money, and I’ll never go back to a big bank.
Photo by Photos8.com.
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I'm just an average mom, trying to live a frugal life and get out of debt. I write about things that have (and haven't) worked to improve my family's financial situation. What works for me may or may not work for you, and you should always consult a financial advisor before making important financial decisions.
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