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What You Should Know about Being a Smart Bank Customer

Banks make a substantial amount of their income from a variety of fees, including automated teller machine (ATM) charges, non-sufficient funds (NSF) charges, and over-the-limit and late charges on credit cards and debit cards. A little attention to detail can help the average bank customer avoid many of these charges.

Q: How can I avoid ATM charges?
A: 
The use of an ATM machine not affiliated with your bank can cost $1.50 to $3.50 per transaction in addition to a similar charge from your own bank. If you only use the ATM machine associated with your bank, you can avoid most of these charges. You should also remember that these fees are assessed per transaction rather than on the amount of the transaction, so a bigger transaction (for example, making one $50 withdrawal rather than two $25 withdrawals) would be more cost effective. Remember that, if the ATM is tied to your checking account, you should enter the transaction and fees into your account to avoid NSF charges.

Q: What, exactly, are NSF charges and how can I avoid them?
A: 
When you write a check that is returned by the bank for insufficient funds, you will be charged $20 to $35 (“NSF charges”).  If the merchant to whom you wrote the check re-deposits it, you can face these charges more than once. To avoid these charges, keep a careful running checking account balance. Most importantly, remember that you can no longer “float” a check today against money that you plan to deposit tomorrow. Checks move through the system too quickly to allow this, since they are often processed electronically the same day they are received. If a bank clears a large check, many smaller checks could bounce, costing you the fees described above for each bounced check.

Q: How can I avoid over-the-limit and late charges on my credit card?
A: 
Attention to detail is the key to proper use of credit cards. Do not get close to your credit limit, as interest charges can put you over the limit, costing you $25 or more per month in over-limit charges. You will typically receive your statement 10 to 14 days before it is due, so mail your payment promptly to avoid late charges.

1/3/2014

Law You Can Use is a weekly consumer legal information column provided by the Ohio State Bar Association. This article was originally prepared by attorney Terry D. Zimmerman, a partner in the Akron firm of Kaffen & Zimmerman.​​​

Articles appearing in this column are intended to provide broad, general information about the law. Before applying this information to a specific legal problem, readers are urged to seek advice from an attorney.

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