Overdraft protection may be coming from Washington - News, Weather, Sports, Toledo, OH

Overdraft protection may be coming from Washington

By Lauren Lowrey - bio | email 

Posted by Lisa Strawbridge - email

(WTOL) - With bounced checks and floating fees, consumers are swimming in a sea of overdraft overkill. The FDIC reports the fee for over-drawing your account ranges from $10-$38 based on the bank.

New data shows that the economic crisis has prompted many banks to raise charges on overdrafts and credit cards in order to boost profits. The result is a record $38.5 billion to the banks for your mistake.

"Everything's changing in the banking industry, so they're trying to find new ways to make up for income that they need to function and to operate. Unfortunately its the consumers who suffer. Often times, its the consumers that have the least who have to pay the most," said Michael Marsh, who overdrafted funds in college.


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William Parker is resolving overdraft fees right now. "Well, its not the bank's fault. The bank tells you, 'This is what's gonna happen if you overdraft.' If you don't have protection in another savings account specifically for that, then you have to pay the fees."

The issue has made its way to Washington. The Obama Administration is asking Congress to approve the creation of an agency that would oversee this type of complaint.

The federal reserve is expected to issue a final rule on overdraft protection plans later this year. Of course, the easiest way to avoid the trouble is to keep tabs on your account.

"I think a lot of times it's just a lack of taking the time, sitting down to balance the checkbook, and making sure you've got the proper amount. Trying to live over your means is always a mistake," said Jackie Long who canceled an account because of overdraft fees.

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