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Bank fees comparison

More fees are coming. How to fight back–or flee.

People say they’re furious at behemoth banks, for myriad reasons: lending practices that helped sink the economy, government bailouts, foreclosures, huge bonuses for CEOs, and now higher fees and tougher account requirements.

Get ready to vent some more. Here’s what’s industry experts and our own analysis suggest you’ll find now and in the coming months:

  • Fee hikes and tougher account requirements will probably continue, especially while the economy remains weak. For example, some banks, including PNC and U.S. Bank, are now charging a $25 fee even to close certain accounts.
  • Customers with a lot of accounts at one bank might avoid some fees, but they’re not immune. Banks may try a spectrum of charges even for good customers, including fees for paper statements and higher safe-deposit costs.
  • You’re more likely to find lower fees and better rates at community banks, larger credit unions, and online institutions.

Banks are trying to make up billions in lost revenue due to the bad economy, new regulations, and in some cases perhaps even their own inefficiencies. But you don’t have to be the one to pay the price.

Does it make sense for you to switch banks? We’ll show you what to expect and what your options are.

Escalating fees

For David Bookbinder, a computer technician from Peabody, Mass. the decision about whether to ditch his megabank was an easy one. When Citizen’s Bank imposed tougher requirements in 2010 for customers who wanted to maintain no-fee checking, he transferred his personal and business accounts to East Boston Savings Bank, an institution with a

fraction of Citizen’s assets.

“I didn’t have the time/patience or attention span to waste on watching my accounts so as to avoid the fees,” he wrote to The Consumerist, one of Consumer Reports’ websites.

It’s a common refrain. Bank experts say that institutions are increasingly depending on fees from traditional bank accounts and other lines of business.

Bank of America, which recently dropped plans for a $5 monthly debit-card fee after an uproar, is charging some customers $5 to replace lost debit cards and $20 for rush replacement, which had not been extra. It also charges e-banking customers $8.95 each month they use a teller to make a transaction. In December TD Bank began charging $15 for incoming domestic wire transfers. And in February Chase imposed a $12 fee on its standard checking account, which had been free for most customers.

Some banks even charge fees if you close an account too soon after opening it. U.S. Bank and PNC charge $25 if it’s closed within 180 days. Chase had imposed a $25 fee if an account was closed within 90 days but dropped it in December 2011.

You’re probably paying more and getting less. Fewer than half of the noninterest checking accounts are now free, down from 76 percent just two years ago, according to a 2011 survey by Bankrate.com.

And the average fee banks charge noncustomers to use their ATMs rose to a new high for the seventh consecutive year, from $2.33 in 2010 to $2.40. Add your own bank’s fee for using an out-of-network ATM and the charge climbs to $3.81 on average. The average fee to cover insufficient funds hit a record $30.83, up from $30.47.

Category: Bank

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