Need some help .. Am trying to help someone who is trying to get a hold on his credit... That said.. he needs and uses a debit card from a credit union..... He has the bad habit of overdrafting and has asked repeatedly to opt out but kept getting a line that "We no longer offer that option"... So he hit a bad patch with his work.. hes already back to work but depleated all his savings and such to get a used vehicle since his current vehicle is no longer eligible to use for his employer.. Hes trying to zero out his account balance by working, but more reoccuring bills keep coming in before he can make enough to level it off.. and they just keep hitting him with fees.. Really do think it be better off if they just decline it.. Do think this is a bit predatory by a CU.. and I thought they were required to decline overdrafts if you implicitly requested to opt out..... They also play games with processing withdrawals before deposits which im not fond of.... so he tends to get hit that way as well...
Even working more doesn't seem to be getting him out of this vicious cycle and i really feel bad for them.. but i cannot bail them out...
I question the legality of this..
Any ideas other than the obvious (make more, fix your credit score, etc)... Thats in the post but this keeps setting them back.
Not to mention theres now a predatory auto note in the mix.. if the bleeding could stop, i think hed be alright...
-J
Shut down that account and move to a better financial institution or move to a prepaid CC of some sort. As far as the legality its really unknown what is being done to banking regulations by the current administration, they may have been rolled back.
@joltdude wrote:Need some help .. Am trying to help someone who is trying to get a hold on his credit... That said.. he needs and uses a debit card from a credit union..... He has the bad habit of overdrafting and has asked repeatedly to opt out but kept getting a line that "We no longer offer that option"... So he hit a bad patch with his work.. hes already back to work but depleated all his savings and such to get a used vehicle since his current vehicle is no longer eligible to use for his employer.. Hes trying to zero out his account balance by working, but more reoccuring bills keep coming in before he can make enough to level it off.. and they just keep hitting him with fees.. Really do think it be better off if they just decline it.. Do think this is a bit predatory by a CU.. and I thought they were required to decline overdrafts if you implicitly requested to opt out..... They also play games with processing withdrawals before deposits which im not fond of.... so he tends to get hit that way as well...
Even working more doesn't seem to be getting him out of this vicious cycle and i really feel bad for them.. but i cannot bail them out...
I question the legality of this..
Any ideas other than the obvious (make more, fix your credit score, etc)... Thats in the post but this keeps setting them back.
Not to mention theres now a predatory auto note in the mix.. if the bleeding could stop, i think hed be alright...
-J
This is a bad situation to be in, indeed. 
If it were me, I would close the account and move to something like Bluebird; that way overdrafts simply won't be allowed.
Once he's back on his feet again financially he can open another 'proper' checking account with a more reasonable bank or CU. Using a prepaid product for now, though, would at least stop the bleeding.
Note that with Bluebird while they do provide a "checking" account number to accept incoming ACH deposits (and paper checks on request) they don't allow ACH pull withdrawals, so your friend would have to pay another way if he's used to using those for some bills (but it sounds like that wouldn't be an issue, anyway).
With banks and CUs, I've never understood why opting-out of overdrafts doesn't apply to recurring charges. It seems counterintuitive (to me) to decline a purchase where you're often physically standing in front of a cashier yet approve something into overdraft that could be dealt with after-the-fact likely with less inconvenience. At a minimum opting out of all debit card overdrafts should always be an option.