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Nickel And Diming At A 279% APR

Tyler Durden's picture


Courtesy of a reader, no photoshops were harmed in the creation of this usury. Granted, the finance charge seems to apply to a minuscule amount of what we can hope is merely an overdraft, or some other comparable fluke, yet all vocal consumer protection advocates in the Hill may want to take a look at what exceptions allow BofA to charge almost 3 times the balance as annual interest. And people wonder why the dollar carry trade is alive and well (and why nobody is borrowing).



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Tue, 11/03/2009 - 11:38 | Link to Comment ArkansasAngie
ArkansasAngie's picture

It's time to get us some new politicians in Washington who are beholding to us.  This bought and paid for current crop of yahoos are too busy trying to stave off investigations into their misrepresentation to actually do something.


The person in Bank of America who authorized that interest rate needs to be fired.  And ... hold your breath with me ... BofA should apologize and write off the debt.


Tue, 11/03/2009 - 12:06 | Link to Comment Anonymous
Tue, 11/03/2009 - 12:26 | Link to Comment Mad Max
Mad Max's picture

Yes, fired.  Out of a cannon.  Into the sun.

Tue, 11/03/2009 - 14:01 | Link to Comment snorkeler
snorkeler's picture

Yes fired, booted in the ass out on to the street where an angry crowd with ball bats awaits.

Tue, 11/03/2009 - 15:02 | Link to Comment Anonymous
Tue, 11/03/2009 - 11:39 | Link to Comment BobPaulson
BobPaulson's picture

Nice.'s legal.

Tue, 11/03/2009 - 11:43 | Link to Comment tallystick
tallystick's picture

Once again, the black sharpie doesn't cut it.  Tyler, maybe you can use photoshop to black out the name out a bit better.

Tue, 11/03/2009 - 11:45 | Link to Comment ghostfaceinvestah
ghostfaceinvestah's picture

LMAO at Mel Watts this morning.  Did he see this headline?

"Bank of America’s Next Chief May Be Based in New York"

Can't wait until the new CEO guts Charlotte.

That's the loyalty you are going to get, Mel, you stupid fucker.

Next time think about supporting your people, not the corporatists who will knife you in the back the first time you turn around.

Tue, 11/03/2009 - 11:47 | Link to Comment Hephasteus
Hephasteus's picture

Nothing wrong with pushing the weak around. I guess that's why they never aired the episode of gilligans island where he freaked out shoved the skippers hat up his butt yanked it out of his mouth rubbed it all over his eyeballs until he got pink eye then stuffed it in his belly button where it was NEVER found again.

Tue, 11/03/2009 - 11:48 | Link to Comment jimcg
jimcg's picture

Anyone maintaining an unnecessary account at BOA, or any other taxpayer supported major bank, is helping to keep these banksters in business, getting their fat bonuses, and all done by sqeezing the little guy.

I've been withdrawing monies every month from these shysters for the past several months. You should see the look on the local manager's face whenever I walk into his branch. "Sir, What can we do to stop these withdrawals"?

I'd love to see everyone do the same. IMO, they do not deserve to be in business.


Tue, 11/03/2009 - 12:08 | Link to Comment Anonymous
Wed, 11/04/2009 - 09:08 | Link to Comment Miyagi_san
Miyagi_san's picture

A staunch Republican maybe

Tue, 11/03/2009 - 12:33 | Link to Comment HedgeRoulette
HedgeRoulette's picture

Problem is that there are not many real "alternatives" out there. On the same principal I have started helping the house of Dimon and likes... What a shame.
Surprises the sht out of me though I am still enjoying some generous 7.24s from C!! (the rest of the costs and fees deferred to April 15th of course)

Tue, 11/03/2009 - 13:16 | Link to Comment Big Al
Big Al's picture

You're absolutely right.  A boycott is the only recourse citizens have against the TBTF banks.  

By why are you "withdrawing monies every month" instead of closing the entire account? 

Tue, 11/03/2009 - 14:51 | Link to Comment Señor Tranche
Señor Tranche's picture

That's why I keep a checking account a B of A (no fees) with $50 in it and a 0% interest balance of $2500 (used it to buy gold) on the credit card they issued me with the account.

I'd leave the checking account totally empty, but I use it to make the minimum monthly amortization payment.  

Tue, 11/03/2009 - 11:54 | Link to Comment mberry8870
mberry8870's picture

Leave them alone, they are just trying to pay back the TARP.

Tue, 11/03/2009 - 12:04 | Link to Comment TraderMark
TraderMark's picture

gold and dollar rising together, change in character


Tue, 11/03/2009 - 12:04 | Link to Comment Anonymous
Tue, 11/03/2009 - 12:06 | Link to Comment Anonymous
Tue, 11/03/2009 - 15:07 | Link to Comment Señor Tranche
Señor Tranche's picture

It is a big deal. I overdrafted my account at a certain TARP bank once, by ~$15.  The transaction that caused the overdraft brought me about, $7 in the red and then I charged a burrito, $6 and some snacks at QT, $2.

I was charged the following:

$35 - for overdrafting in the first place

$105 - $35 for each overdraft transaction

$35 - for maintaining a negative balance for 5 business days.

So that's $175 on a $15 loan (though they would never use the term "loan" or it would be usury) for a week.  That's ~ 60,000% IRR.

I yelled at the bank manager for about ten minutes, but just paid it.  I am fairly financially sophisticated so I just write it off as a stupidity fee (never overdrafted again, that's for damn sure).  But for someone who doesn't know anything or doesn't have $175 to spare that is huge and completely usurious. 

The worst part is that I asked the bank manager to change my account settings so that I couldn't overdraft, and the card would just be declined.  I was told that they couldn't do that.  So basically they are encouraging overdrafts, charging ridiculous fees and telling someone who asked not to be extended credit to fuck off.  That is a bullshit business. 



Tue, 11/03/2009 - 12:13 | Link to Comment Anonymous
Tue, 11/03/2009 - 12:14 | Link to Comment Anonymous
Tue, 11/03/2009 - 12:29 | Link to Comment Gordon_Gekko
Gordon_Gekko's picture

The same thing happened at the beginning of this year.

Tue, 11/03/2009 - 12:16 | Link to Comment pbmatthews
pbmatthews's picture

I hate to be the one defending BOA (ever), but this APR was applied to what appears to be a balance of $1.50.

Given that the APR includes minimum late fees, etc., on such a small balance a 279% APR is quite possible.

Tue, 11/03/2009 - 12:29 | Link to Comment Mad Max
Mad Max's picture

This seems quite likely, but just demonstrates how the "law" (ha,ha) on credit card arrangements bears little resemblance to the law governing virtually all other contracts and commercial transactions.  Hundreds of years of common law history prohibit a contract from imposing a penalty just for penalty's sake.  Liquidated damages are fine, if they are reasonable (which is usually a wide barn door of a test), but I can't see that a late fee of $30 or whatever imposed on a $1.50 balance is reasonable.

Tue, 11/03/2009 - 13:20 | Link to Comment Anonymous
Tue, 11/03/2009 - 12:26 | Link to Comment Anonymous
Tue, 11/03/2009 - 12:35 | Link to Comment mberry8870
mberry8870's picture

Saw that and it was deserved. I am pretty sure Liesman said something like why should you care about the value of the dollar.

Tue, 11/03/2009 - 12:30 | Link to Comment Gordon_Gekko
Gordon_Gekko's picture



Tue, 11/03/2009 - 12:46 | Link to Comment waterdog
waterdog's picture

The easiest and best way to obscure information on a document that is going to be photocopied is to use a product like Liquid Paper's Dryline grip.

I have been using it for years to alter documents that contain data that I wanted not to exist.

It has never failed me. The data is completely obscured and if done correctly, one cannot tell that the data ever existed on the document.

Tue, 11/03/2009 - 12:54 | Link to Comment Anal_yst
Anal_yst's picture

There may be a simpler explanation for this:

Back in the day I spent some time in the CC biz, and generally the finance charges are the greater of X% of the balance or some other rate/fixed amount.  Doubtful, but something along those lines may explain this statement.

Tue, 11/03/2009 - 18:44 | Link to Comment Miles Kendig
Miles Kendig's picture

The undrestanding you bring to specific subject matter continues to astound..

Tue, 11/03/2009 - 12:59 | Link to Comment ArkansasAngie
ArkansasAngie's picture

The trouble is when you hybridize Democratic/Republican Solutions the end product is lots of laws and no enforcement.

Door number three please Vanna

Tue, 11/03/2009 - 13:32 | Link to Comment kote
kote's picture

The guy has a current balance of $1.50.  A minimum finance charge easily explains this.

Tue, 11/03/2009 - 14:33 | Link to Comment Anonymous
Tue, 11/03/2009 - 15:53 | Link to Comment thebone
thebone's picture

Hey somebody has got to pay for K. Lewis's package. 279% APR on balances might just take care it.

Sun, 11/08/2009 - 18:14 | Link to Comment Anonymous
Sun, 11/08/2009 - 23:42 | Link to Comment Anonymous
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