NFCU handling of past due CC accounts

[8bitmachinegun]

I recently had a rather unpleasant experience with NFCU of all places. It was switfly rectified once a transferred a fairly trivial amount to my NFCU CC, but it makes me wonder about how they (and other CC companies) handle past due accounts.

Recently I purchased a new car. I paid part of the downpayment out of my NFCU checking account, but forgot about a scheduled payment to my NFCU Platinum MC and drew out about $40 too much. So when the automatic transfer bombed, NFCU instantly deactivated the card, reduced my CL to $0, and demanded double the normal minimum payment. 

To their credit, once I moved the $40 from another account to my NFCU checking account and reinitiated the payment, the problem was corrected in 24 hours, and everything was restored. But this doesn't square with the experience I've had with other creditors. Usually if you miss a payment, you get a grace period before they cut you off at the knees. Now my experience with being past due is several years old. Is this typical treatment of past due accounts these days?

[Remedios]

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@8bitmachinegun wrote:

I recently had a rather unpleasant experience with NFCU of all places. It was switfly rectified once a transferred a fairly trivial amount to my NFCU CC, but it makes me wonder about how they (and other CC companies) handle past due accounts.

Recently I purchased a new car. I paid part of the downpayment out of my NFCU checking account, but forgot about a scheduled payment to my NFCU Platinum MC and drew out about $40 too much. So when the automatic transfer bombed, NFCU instantly deactivated the card, reduced my CL to $0, and demanded double the normal minimum payment. 

To their credit, once I moved the $40 from another account to my NFCU checking account and reinitiated the payment, the problem was corrected in 24 hours, and everything was restored. But this doesn't square with the experience I've had with other creditors. Usually if you miss a payment, you get a grace period before they cut you off at the knees. Now my experience with being past due is several years old. Is this typical treatment of past due accounts these days?

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If I understood you correctly, you had returned payment. 

The whole "if you miss a payment you get a grace period before they cut you off at the knees" isn't applicable here.

That's when the payment is late, grace period is temporarily lost, there is usually a fee plus (and interst). 

Your issue is returned payment which is worse than making a payment a few days late.

A lot of other lenders would simply close the card, so I'd say you had extremely pleasant experience. 

[8bitmachinegun]

@Remedios If true, that's a fair point. But since its a 'scheduled payment' that's pushed from the checking account, wouldn't the transaction simply not happen if an NSF condition exists? (I need to double check that; maybe the auto payment is set up on the CC side and tries to 'pull' the necessary cash regardless of checking account balance.) 

That is an important distinction I need to figure out. If NFCU was reacting to non-payment exactly on time, it still seems an excessive reaction to me. But if it's essentially a bounced check, I see where you're coming from.

[Remedios]

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@8bitmachinegun wrote:

@Remedios If true, that's a fair point. But since its a 'scheduled payment' that's pushed from the checking account, wouldn't the transaction simply not happen if an NSF condition exists? (I need to double check that; maybe the auto payment is set up on the CC side and tries to 'pull' the necessary cash regardless of checking account balance.) 

That is an important distinction I need to figure out. If NFCU was reacting to non-payment exactly on time, it still seems an excessive reaction to me. But if it's essentially a bounced check, I see where you're coming from.

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Not "essentially a bounced check", it's bounced payment. Method by which you chose to pay isn't relevant. 

When you schedule a payment, there is no "is there enough money in the account" verification, you are basically attesting there is by scheduling it. 

If you're late, a case can be made that customer forgot. 

When payment bounces, the only case to be made is *there is no money*, and that's why card was temporarily restricted. 

You can view it as excessive, I view it as a gift. A lot of cards issued by major banks wouldn't survive this experience, but up to you how you want to view it. 

I'd write them nice review and dropped off *Thank you* note. 

[firefox100]

In this day of ACH debits it can turn into nightmear, last week I had ACh that was to be dollar 500 taken out of my checking account, which turned out be 7K which made couple of thousand of dollars of transactions to bounce, bank who had done the debit said it was computer error and my bank did not charge me any fees for any of the return transactions. The company who set off this chan reaction is sending out letters and my bank is also going to contact people and credit card companies that this was not my fault. I got on top of this right away. I hope this d does not cause me any problems in the long run, every one got paid.

[Brian_Earl_Spilner]

You didn't miss a payment, you bounced a payment. Huge difference, especially during these times. I'm sure they offered you OOPS or a CLOC so it doesn't happen again. If not, you should look into it. 

https://www.navyfederal.org/checking-savings/checking/resources/checking-protection.html

[Anonymous]

Through whatever chain of events, with whatever excuses and justifications, you missed a payment and yet when they stopped letting you continue to use their money still that becomes an "unpleasant" experience?  Then, when you finally paid they restored your charging privileges with full CL?

Sounds like a rather pleasant experience to me. I'd be thanking them for their understanding and willingness to work with me, if I was you. 

[8bitmachinegun]

I've messaged NFCU for clarification on whether this was a missed or bounced payment, and also inquiring about ways to prevent it. So hopefully I can use one of @Brian_Earl_Spilner 's suggestions to prevent future problems. I also have a Roth IRA with NFCU that is more than sufficient to cover any missed payments, so *maybe* that's why they weren't ready to drop the hammer and cancel the CC even if it was a bounced payment. 

One complication is that NFCU is not my primary financial institution, so I don't normally keep large amounts of money in my NFCU checking account. The closest branch is 100 miles away, which makes cash deposits ridiculously difficult. Other than this experience, I've usually enjoyed working with them. If I did keep my primary checking account with them, this probably never would have happened.

[Brian_Earl_Spilner]

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@8bitmachinegun wrote:

I've messaged NFCU for clarification on whether this was a missed or bounced payment, and also inquiring about ways to prevent it. So hopefully I can use one of @Brian_Earl_Spilner 's suggestions to prevent future problems. I also have a Roth IRA with NFCU that is more than sufficient to cover any missed payments, so *maybe* that's why they weren't ready to drop the hammer and cancel the CC even if it was a bounced payment. 

One complication is that NFCU is not my primary financial institution, so I don't normally keep large amounts of money in my NFCU checking account. The closest branch is 100 miles away, which makes cash deposits ridiculously difficult. Other than this experience, I've usually enjoyed working with them. If I did keep my primary checking account with them, this probably never would have happened.

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The CLOC is a favorite here. It requires a credit pull, but can be grown to $15k. Upside is it counts towards lowering your credit card utilization. Down sides are it's a new credit account, starting limits aren't very big right now, and it's a hard pull whenever you try to grow it.

[W261w261]

It was NFCU that had the "rather unfortunate experience" with you. From time to time on here, there are members who walk too close to the edge, make a miscalculation and go over, and then feel that since their oversite was minor, so should NFCU's reaction be. If I understand your situation, you had no safeguards in place (which are readily available at NFCU) to cover an overdraft situation. I assume now you're going to do that. But in my opinion this was an "accident" waiting to happen. Although the amount involved was "trivial," that also implies that you were leaving yourself with a trivial balance in your account. The nearest branch may be 100 miles away, but wire transfers, although expensive, go through in hours, and you can also make mobile deposits to your Navy account if you have a paper check on your primary account.

As others have pointed out here, you're actually lucky that Navy is more tolerant. It may be just a few bucks, but the implication implied by the experience, while unknown exactly to us, could range from a slap on the hand (which sounds like what you got), to a little black mark which could manifest later in ways that you don't know yet.

Computers are simple creatures in many ways. They do what they're told. Whatever you did, big or small, to one degree or another you've put yourself in a place that has an unpredictable outcome, and I don't think you want to be there. I'm sorry if this comes off as too judgmental, but I think it's important going forward that you don't play it so close. Everybody that does goes over at some point, and these days the UW seem to think that if you are close to the line on one hand and also careless enough to not keep yourself from going over, that that means maybe you're not the kind of person they should trust as much going forward, or sometimes the kind of person they'd rather not do business with.