Posted on 05/03/2010 5:12:21 PM PDT by Kartographer
When Hope and Matt Hughes stopped for supplies at a pet store last month, they thought the trouble with their debit card was just a glitch. But it turned into a financial crisis.
They quickly discovered that their bank, Wachovia-turned-Wells Fargo, had deducted $4,059.82 from their checking account, wiping it out.
It was no glitch. It is called the right of setoff or offset, a long-accepted practice dating to early English common law.
(Excerpt) Read more at ajc.com ...
I was very lucky, and I bless my good fortune to be married to a woman who has good common sense, doesn’t feel the need to buy stuff, and is into saving and money management.
I owed over $1200 when we got married (Okay, a very large chunk of that went to an engagement ring, I admit) but we bought a very small house (standard 1963 ranch style with turquoise appliances and a red shag carpet!) a year before we were married and drove our cars for a while.
I am not someone who spends money like water, but I do subscribe to the “you could be hit by a bus tomorrow and what good will it do you” mentality.
We compliment each other well...:)
I missed that...the pet store!
We once had the IRS empty an account without notice for a tax debt we didn’t owe, and several years later we finally got it back, without interest and not so much as a thank you note. The experience soured me on banks, not to mention the IRS.
The IRS does already, and has been doing it for years.
Why, these people owed the money and had for months been notified by the bank.
I had people who owed money to IRS. They tend to send many written notices before they go off taking it from their account or paycheck.
I love it when they say “you can’t do that” and I say “I just did”
Better yet, never keep your money in a bank that you owe. It avoids unpleasant misunderstandings.
Don’t keep all your money in one bank.
Yep - that happened to an old friend of mine - declared bankruptcy and was amazed that the bank took the little bit they scraped into savings - where they owed money! No notice necessary!
Let me see if I understand. If someone gets in debt, and can’t pay the bank, the bank unilaterally performs an execution on the account.
On the other hand, if the banks gamble away depositors’ money, are on the verge on insolvency and throw the world into global recession, they go to their puupets in DC, and Beranke gives them trillions of taxpayer money at 0 %, until the banks’ profits triple.
Remind me never to owe you money ;-)
Heck, I'm retired and still drive beaters, always have. I keep 3 of them so if one goes down, I still have 2 good ones available so I can work on the broken down one at my leisure.
There is a simple way to protect from this happening. Make sure that you do not have a checking or savings account with a bank that you have a loan with. I would not even have a credit card with a bank that I have a checking or savings account with.
i think it’s called ‘did you read the fine print’?-not only on her loan app but the bank acct it was connected to
Jay Lawrence, Atlanta spokesman for Wachovia, which became a Wells Fargo company in 2008, said the bank uses the right of setoff as a last resort. Lawrence didn’t want to comment about the Hughes’ case except to say the bank’s records don’t support some of the Hugheses’ accounts.“We don’t do this without lots of attempts to communicate with our customers and try to work things out,” Lawrence said. “When this happens, we don’t like to do this. We want our customers to succeed.”
$100k in student loans, she's out of school with a degree in marketing... and the family income is from her husband. I bet I know exactly who this couple voted for... the Candidate that will make student loan repayment "go away".
“My question is why did they think that they could fall behind on these obligations and the bank not take action?”
Because our society doesn’t hold individuals responsible for anything. It isn’t “fair”.
“Higher education has become a scam”
That’s because everyone is getting degrees, and many of the degrees are in worthless disciplines. How many jobs are there for underwater basket weaving, for example.
Same here, but we got interest. Took a congresscritter to make it happen.
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