My favorite personal finance book is Ramit Sethi’s I Will Teach You To Be Rich. One of the best lessons I took away from the book was the idea that bank overdraft fees are negotiable. In the book Ramit provides a word-by-word script for negotiating with your bank and the script works.
This was the first time in my life that I realized you could actually talk your way out of a bank fee. The idea has never even crossed my mind before reading IWTYTBR.
An overdraft fee occur when you use your debit card to withdraw more than you have in your bank account. Some people knowingly do this because they have no option and they still have to eat. But a lot of people mistakenly stumble into this fee by being careless with a big purchase, or maybe they were in the middle of transferring money from one place to another and left the bank account a little lower than they thought.
These pesky fees are one of your bank’s big money makers – they brought in $27 billion in 2009.
But what the banks don’t advertise is that you can talk your way out of these fees with a decent record and some niceties.
How I Got a $35 Overdraft Fee Refunded
Just last week, I received my first overdraft fee from my bank back home – Harris. I made a careless mistake and wasn’t aware of how much money was in my account when scheduling a credit card payment. I was busy transferring money from different banks after the bank that shall be remained nameless canceled my account.
Either way, it was my fault.
It was a $35 fee and it just added to a bad week of banking (hopefully I won’t say that sentence again).
Thankfully, I have a good relationship with Harris and have been a customer since high school. They were my first bank, checking account, debit card, and credit card. I’ve never had any problems with them and they had never had any problems with me. I decided to give them a call and try to get the fee removed.
Here’s how the conversation went:
Me: “Hi, I had my first overdraft fee charged last week. I apologize for this happening, but I was between money transfers and made a careless mistake. I’ve been with you guys for 7 years and this has never happened before and I promise it won’t again and I’d like to have the fee removed.”
Bank rep: “No problem, Mr. Morgan. We’ll get that fee removed right away. We understand this happens all the time. Hold on one second. (15 seconds later) The $35 fee will be refunded by tomorrow.”
Me: (stunned) “Thanks a lot. I love your bank and I promise I’ll watch it more carefully from now on.”
Like that, it was over. I had a strong relationship with the bank and no prior red marks so they thought it was best to keep the relationship strong and refund the fee.
How to Get Your Fee Removed
Be Gracious
Praise the bank’s services and talk highly of them. Have you heard the term hamburger criticism? It says if you’re going to criticize someone it’s best to start and end with a compliment (the fluffy bun) and give your critique in the middle (the meat of the problem). Well, when you’re calling to get a fee removed, your phone call should be nothing but bun (compliments).
Tell the bank how long you’ve been a customer and what specifically you like about their bank. Try this: “I’ve been a customer with you for 6 years and I love how easy it’s been to get my questions answered.” Don’t make up positives, but let them know what parts of their company you like.
Admit Your Fault
Your human. They know that. Admit your mistake and say it won’t happen again. Explain your situation and give the phone call a personality. Give a reason for the late fee even if it was just you being forgetful.
They’re much more likely to help you if they empathize with your situation and feel connected to you if you share some personal details. They receive a lot of phone calls so be unique and be yourself. Don’t blatantly lie to them, but be honest and you’ll be rewarded.
Be Stern With Your Request
“I’d like to have the fee removed” sounds a lot better than “Is there anyway at all you could possibly, maybe, have that fee removed sometime soon?”. Be confident, without being pushy. Customer service people are judged by amount of transactions completed and time. If they can fix a problem with a simple “Yes” they’re more likely to do it. My problem took the rep less than 90 seconds to complete. I bet he prays for calls like me.
Bonus: don’t let it happen again
This isn’t a cheat code that you can go back to every week. Don’t go throwing around your debit card like your Jay-Z at a club. This is a way to fix a mistake and keep your money, but it won’t work if you’re calling your bank 3 times a month to get a fee refunded. Also, if you have a $132 overdraft because you bought 5 items with $0 in your account, you might be out of luck. This isn’t a guaranteed formula, but if you’re sincere it’ll work more than it won’t.
Have you ever negotiated your way out of a fee? Share your story and tips in the comments!
Photo: MistressF
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Of course your best bet is to not overdraft in the first place. If you are managing your money well that should not be a problem.
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Austin Reply:
June 2nd, 2010 at 7:41 pm
True, but mistakes happen (exhibit 1A right here). Even people who have their head on straight forget sometimes.
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yep, accidentally overdrafted like 3 times in one week just because I underestimated my balance. when I called the bank to ask why I had a $75 penalty ($25 for each overdraft), the lady on the phone was just like “let me see if I can get rid of that for you” .. I didn’t even have to ask. I think she could tell I was upset and didn’t mean to do it.
Like you, I never even knew that waiving fees was a possibility. hoo-rah? Since then, no overdrafts for me! Like the SNL fake commercial about getting out of debt “So you mean, if we don’t have any money, we can’t spend it???” <3
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It’s like a magic sentence that no one knows about.
I really wonder what the bank customer service reps are told by their bosses. Is it such a low % of people that ask for a refund that it doesn’t matter? They make so much $ off these fees so I guess it’s feasible to give back some to the dedicated few who call and get it removed.
Anyway, congrats on the $75!
P.S. What bank do you use? Let’s send them some internet love for being cool.
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s!j Reply:
June 9th, 2010 at 9:25 pm
yeah it was usbank in naperville. i called the branch (and went down there maybe? don’t remember) and not the generic helpline number. usbaaaaank
those the regular operators were curt and/or sounded bored when i called to ask how to get onto my online banking account after it locked after i couldn’t guess the answers to my own security questions. d’oh. (that happened like 3 times)
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i used this method online with live chat with my bank..it worked!
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it was bofa
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Austin Reply:
July 7th, 2010 at 7:09 am
Awesome :)
Glad I could help!
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