Shakedown

by earthriderjudyberman In Money, Uncategorized 52 Comments

monopoly - moneybags

By Judy Berman

It is a squeeze play for more money. All the perpetrator lacks is a mask and a gun.

In the old days, such thefts took place by outlaws when robbing riders on stagecoaches or trains.

Now, it’s the banks, car-rental agencies and others who relieve folks of their money. Rather than luring customers in, they’re chasing them away.

My rant is the result of my bank using “statistics” to deny me a lower interest rate. In a letter, unsigned, the bank states that “our decision may have been based in part on a credit score.”

I told the loan officer that another bank has offered me a more attractive interest rate. In a standoff at the O.K. Corral, my bank does not flinch.

So I download my credit report. There are no red flags. No cautionary tales for the loan officer to “Run. Run in the opposite direction. Do not give this person any money.”

Instead, the report reveals that I have an excellent credit score.

stagecoach

My bank’s letter says I am approved for credit for the car loan. But it does not want to give me the reduced interest rate and repayment plan. Instead, the bank aims to go for $5 more a month – an additional $60 a year.

So, my bank decides to shake me down for $5 more a month on a car payment. It’s still willing to do business based on the original, higher interest rate.

Brilliant.

I’d love to meet the bean-counting genius that thinks it’s a great idea to wring a few dollars more from a customer when another bank is salivating for that customer’s business.

Short-sighted. Penny wise and pound foolish.

This also happened a few years ago with a car-rental place.

We turned the car in with a full gas tank. But we didn’t realize that the agreement we signed required a receipt to prove we filled it up that day.

Even though they could see the gas gauge read “FULL,” they dinged us for about $18 more.

Great Train Robbery - screenshot

They may have made a few dollars more, but they won’t see any repeat business from us.

What is it with companies that have lost any sense of treating their customers right?

We also never lose an opportunity to tell people to beware of what they’re signing.

Now, we have a decision to make. One our current bank should have foreseen.

I do appreciate the service they provided at the beginning of our banking relationship. But I’m not feeling very valued right now.

My next move? Undecided.

 

What would you do? Have you ever felt undervalued as a customer?

 

COPYRIGHT NOTICE: Judy Berman and earthrider, 2011-15. Unauthorized use and/or duplication of this material without express and written permission from this blog’s author and/or owner is strictly prohibited. Excerpts and links may be used, provided that full and clear credit is given to (Judy Berman) and (earthrider, earth-rider.com, or earthriderdotcom) with appropriate and specific direction to the original content.

 

Video clip: Shakedown – opening song in Beverly Hills Cop II sung by Bob Seger https://www.youtube.com/watch?v=pk-W_i7Z59I  

Music Video: For the Love of Money by the O’Jays https://www.youtube.com/watch?v=GXE_n2q08Yw 

Main Photo: Monopoly – moneybags – our Hasbro board game

Photo: Stagecoach – Concord stagecoach 1869 – public domain. “used by express companies on the overland trails. Soldiers guard from atop.” http://upload.wikimedia.org/wikipedia/commons/thumb/4/41/Concord_stagecoach_1869.png/799px-Concord_stagecoach_1869.png

Photo: “The Great Train Robbery” (1903) – screenshot. Author: Edwin S. Porter Public domain. http://upload.wikimedia.org/wikipedia/commons/b/b5/Great_train_robbery_still.jpg

  1. My solution to the car purchase dilemma is to not buy new and pay cash when I do buy. I bought a 2009 Sonata in 2010 with just under 11K miles on it. I paid cash and saved a ton on interest and finance charges

  2. Ooooh, that car rental story makes my blood boil. For eighteen bucks, they’ve lost a customer for life and who knows how much residual business from your sphere of influence. Such shortsightedness is rampant in business transactions today sadly. We own a small business and our experience with banks/lenders is that no single entity gives us everything we need. We pick the lesser of the multiple evils and hope for the best. Sometimes the seemingly “better deal” results in such awful service that you rue the day you switched.

    1. Trust me, Barbara, I advise anyone considering a car rental to beware of that company and to look out for that hidden cost. I’m convinced that shortsightedness does come back to bite them. You’re right on those “deals” that are dangled before consumers. It’s easy to lose sight of what you might shell out as a result. 😉

  3. I’d jump ship, too Judy. As long as it doesn’t cost me anything in terms of penalty or some other administrative hiccup. Your story reminds me of the time in the early 1980’s. I had an account with the Royal Bank and was now shopping for bridge financing. I’d be paying the money back within a month or two. I had stellar credit rating and never defaulted on payments. I was employed. However, I was just recently separated. I was (and, as it turns out, still AM) a woman. My application was turned down, end of discussion.

    I walked a block to the competition and in half the time it took me to make the trip, I got my loan.

    1. I had a similar experience years ago, Maggie. It is infuriating when credit or a loan hinges on your gender … especially if you’ve been conscientious about paying your bills. Good for you in getting a better deal. It’s the other business’ loss.

      We did get the auto loan from the other bank. I’m now weighing short term vs. long term strategies on whether I go or whether I stay. 😉

  5. I feel this way all the time, Judy. It’s like we’re being nibbled to death, one tiny bite at a time. I’ve never understood the interest rate thing at all. The bank seems to be saying, “We don’t think you can afford to pay back this loan at the lower rate. We’ll lend you the money, but only if you pay more interest on it. Somehow.”

    1. That really is a mixed message, Charles. I heard a story on NPR yesterday – “This American Life” – where a credit dispute wound up in court. The collecting agency bought the debt from a credit card company and then told the person who owed the money to pay up or go to court. When the debtors did show up in court, they asked for an accounting of how the agency came up with what was owed. Turns out, those are the magic words to get out of the debt. They collecting agency produced no documentation and withdrew their complaint. No money was paid and the case was closed. Crazy, huh? 😉

  6. interesting and maddening. i heard a story on npr last year, talked about how the big enterprises, banks, utilities, etc. are now making their big money. they attach all sorts of ‘fees and charges’ to a consumer’s account. there is a word for it, but basically they researched what the ‘traffic will bear level’ before their is an uprising. they arrived at a dollar amount of 3.99 or some such figure. if the average consumer sees an ambiguous charge/fee on their bill, it is so complicated, as in the case of a cell phone or cable bill, most won’t question it if it’s under that preordained tipping point. most people won’t bother calling and questioning it. they can call it, ‘administrative fee, state processing fee, etc.’ and they make many extra millions of dollars a year this way, based upon sheer volume and the low number of people who will question it. also banks and airlines now make much more off of fees and charges and penalties than they make off of all of any other part of their business.

    1. Beth … NPR also had an interesting story on credit on “This American Life” yesterday. (See comment to ‘bronxboy55.’) It is maddening how consumers are being taken advantage of. We paid the freight on the bailout to these institutions in 2008 (?). They have taken that money – paid thru our taxes – and used it to fatten their wallets and their bottom line.

      I think consumers should challenge any fee that’s attached to their bill. Thank you for this information. I know we have squawked many times about ‘extra’ charges and they are typically removed immediately. 😉

  7. thank you for the recommendation, judy, i’ll check it out for sure. and after i heard that piece, i began to question the ‘fees’ too, with the same results. it’s all a numbers game for them, some will balk, but some will pay, on par with a nigerian online scam.

  8. Changing banks and arranging all your automatic payments, etc., takes work. I think most banks are banking on the fact that you don’t want to be bothered with that. A assumption that has kept me at my bank for years!

    If you have will and follow through to change banks, I say, do it Judy!

    Diana xo

    1. You are so right, Diana. I just got thru switching banks about a year ago. I did so because I was unhappy with what I perceived to be efforts to nickel-dime me. I am still debating the pros and cons of taking my money and running. 😉

  9. When we first moved to Colorado years ago, before I began teaching I worked at a bank, handling accounts and helping customers research errors in their totals and get back on track. The people I worked with were professional and helpful and kind, and our customers were great to work with.
    You can imagine my surprise when this bank did to me what yours is doing to you. However, as it turns out, although the bank still has the same name,it has been bought/sold/re-structured ELEVEN times since I worked there. ELEVEN! Only two of the tellers are the same; everything else has changed.
    It took lots of research and double checking and calls before we found a better bank with more upfront responses and rates. However, and I don’t mean to discourage you on this, Judy, no telling how long before this new bank takes the same route. It’s very frustrating.

    1. Marilyn … My first job was in a bank. I worked in the mortgage department, but I didn’t have any direct customer contact. I loved the people I worked with and for, and I learned a lot there.

      It is frustrating to know that you cannot depend on a place to remain the same – certainly not thru ELEVEN shake ups. You’re right. It requires work on our part – the consumer – to find the banks and businesses we want to deal with. Then, no telling how long it’ll be before we have to begin that search and research anew.

  10. Judy – don’t get me started on customer service – it’s virtually non existent these days. No loyalty for longevity – nothing. I’d jump ship on principle but it probably wouldn’t get me very far!

    1. I know what you mean, Jenny. I jumped ship from one bank a year ago because I felt it was adding fees unfairly. For a year, I was happy at my current bank. Now? Not so amused. 😉

  13. You hit a nerve here, Judy! Lots of rants and a few raves. I’ll add my story about our experience with a car rental company in Washington state this past January. I turns out we were accused of damaging the car on the bumper close to the license tag. We never came within a hair’s breadth of any other vehicle or obstacle. Back story: We turned the car in about 4:00 am and no one was there to verify that the car was scratch free. Typically, we take photos of cars we lease to fend off such accusations, but it was early and husband forgot!

    My contention: “Your company cannot verify what happened to the car between 4 – 7 am when it was officially checked in.” There was a lot of back and forth, but finally the case was closed in our favor. Lesson learned: Always take photos of car at drop off!

    I think the company is running a racket here and may randomly make false accusations which other customers may be too hesitant/lazy/encumbered to fight.

    1. Great advice after a terrible experience, Marian. Let the car renter beware. I haven’t taken photos of the cars we’ve rented. But it’s something I’ll do in the future. We take out car insurance … which is costly … but it follows an accident in Alaska (I’ve written about this). We totaled the car and only had our regular car insurance cover the rental. Believe me, our car insurance carrier was not happy.

  14. Don’t even get me started Mom, we just went through the nickel and diming with our cell phone company. It finally took me disputing the validity of our contact before a customer service rep managed to do in 10 minutes what I had been trying for months to get done. You would think that cell phone companies like any other businesses would do whatever it takes to get your business these days but they are just as bad as banks and car dealerships.
    Sorry you are not happy with your new bank, I am sure you will get it fixed.

    1. Jenn … How aggravating. How much time is lost trying to get something corrected? Or getting a business to do the right thing? You’re right. If businesses don’t value their customers, then they shouldn’t be shocked when the customers switch their allegiance to another company.

      I’m not sure what my current bank can do to make me happy. Maybe, deliver fresh, homemade cookies to our door. Nah, that’d never work. 😉

  15. So true.

    “Now, we have a decision to make. One our current bank should have foreseen.

    I do appreciate the service they provided at the beginning of our banking relationship. But I’m not feeling very valued right now.”

    The best move you could make. And may others follow suit…

      1. Yes, by all means consider all options.
        I assumed you were going to take your business elsewhere.

        comment from earthrider to Tom Simard:
        Once I determine what other banks have to offer, I might transfer all my business elsewhere. It is a hassle. I just got thru doing this a year ago. But … if there are better places to do business, then that’s where I’ll go. 😉

  16. I go into my bank and sit, wait for a financial adviser or manager and talk. I have found lots of errors and charges over the years, with credit cards, companies and banks. I hope you will get the $5 monthly charged removed and I am sure you are a valuable client, so they will possibly compensate you more… Smiles, Robin

    1. Robin … The $5 monthly charge was part of my bank’s higher interest rate and repayment plan. I chose to go with the bank that offered a lower interest rate and a less expensive repayment plan.

      You are wise to check your statements for errors. It is in the consumers’ best interest to do so. I try to be vigilant as well. Those hidden fees also can make your blood pressure skyrocket. 😉

      1. Oh, sorry, Judy! I thought it may be ‘negotiable’ but you were smart to go with a different bank… Glad you appreciated the thought, if not accurately presented! Try not to let that blood pressure skyrocket, I like you sticking around here, Judy! Smiles, Robin

  17. Ooooh, these banks really don’t care, about us or it seems themselves! I tend to view banks as crooks really. Crooks that I have no choice but to hold my money with, unless I go for the other option of hiding it under a mattress – that doesn’t appeal much either!!

    Banks seem only interested in people who already greatly in debt to them. The trick is to get their customers paying them everything they earn for the rest of their lives. This is why every new bank appears to fall over themselves to be helpful to you when you first sign up with them. Everyone I know who is in good credit gets this kind of treatment from their bank. And yet the ones who are dysfunctional savers, and continue borrowing, are always offered that little more, a slightly lower interest rate just to keep them with that bank a bit longer, and then they get so badly in debt, no other bank will take them. That bank then has a customer for life – not by choice, but by trickery! 😦

    I got heavily charged a few years ago with a bank I’ve been with for nearly 20 years for accidentally overdrawing by 21pence. The first notification for the initial charge was alarming, but before I could pay any money into my bank to prevent further charges, the following morning I received two more letters with two more charges. One was the next daily charge, and they threw in a second one because it was conveniently (for the bank) the start of my next banking month, so I got a monthly charge too! Because the account was so old I couldn’t find my original documents to prove it was not the start of my banking month. The bank was taken over by another bank company ten years before and they may have even set a new time for my banking month – who knows! But my gut feeling was it was an invention. I’ve heard of banks doing that before – lying!

    I think what they hoping for in a situation like that, was that I would be unable to find any money at all that month (maybe I would be waiting to be paid my wages at the end of the month) to pay the charges. The charges would keep going up daily and I would be in debt to them for a very long time, all over nothing at all. This was not my main bank account, so I was able (reluctantly) to transfer money that day. But it amounted to well over £100 just for two days of being over drawn for 21pence. Crooks – there’s no other word for it!

    Luckily for me someone in that bank while talking to me on telephone banking a few months later actually arranged very nicely for me to have the money returned. But I think they were scamming me and the bank they worked for because I only received half the money back. Talking with a manager (in my complaint) actually in the bank, they admitted that I should never have been offered the money back in the first place. I thought it was too good to be true!! I took a guess by that mangers tight lipped response that the other half of my money that I never received had possibly been paid in another direction! So banks can’t even trust their staff! I got all the money refunded purely on the basis that it had been promised therefore they had to honour the decision – with gritted teeth!! 😀

    I think the only way to get what you want from a bank when it comes to borrowing and interest rates, is to keep moving. Not nice I know, but might be the only way. I still know people who only bank with one bank, I feel that’s really dangerous, banks should never be trusted at all. Eggs should never be kept all in one basket. Banks are one of those, I hate to say this – necessary evils. Thank goodness there are no others in my life! 🙂

    1. Suzy … I had a relative who went thru something similar to what you did. She was overdrawn by less than $25. But she wasn’t informed immediately. So any time she made a small purchase of even less than $5, they added an additional $25 penalty fee. By the time this all caught up with her, she owed more than $250 in penalty fees on a $25 overdraft. I’m not sure how it was resolved, but I do know that it jeopardized her ability to pay her rent. Those bankers had no conscience.

      I used to joke that ‘you can’t hit a moving target.’ Maybe that should be the motto I follow here. 😉

  18. Oh yes, this is all so true. And yes, I have felt undervalued as a customer and each time that happens I stop shopping there and the company inevitably folds. I think I have some hidden powers maybe, or it’s the power of multi-customer reactions.

  19. I agree that businesses do far too much short-sighted dollar-grabbing, Judy. It’s plain stupid. But I also agree that you should not knee-jerk your way out of the longterm relationship with your current institution. Some things to ponder: Is this the first ill treatment in years of a comfortable place? Can you find bad stories online about the new loan-giver? Perhaps they do ugly things after sweet-talking new folks in with lower rates. Who knows these days. So much to consider. It’s complicated! Good luck, my friend.

    1. I’ve only been with my current bank for a year. Until this, no missteps. The new loan-giver was my former bank – which I did leave because of several missteps. Thus, the hesitancy.

      Thanks for the advice, Mark. You’re right. I won’t rush into anything. 😉

  20. This is a most appropriate and timely post Judy.

    Based on my years of working in the corporate world, my understanding is that the instances of business and client mis-orientation and shortsightedness you speak of is pretty widespread even though the honchos in their ivory towers may choose to think otherwise. Organisations give lip service to empowering sales and customer handling personnel. But in reality, the system and control freaks in the Head office like to tie these guys through water tight procedures and work flows. Ostensibly to bring in uniformity and efficiency but in reality it boils down to a corporate belief that empowerment and flexibility would get misused and favours would be given out. It essentially comes down to a lack of trust and the ‘need to play safe’ mindset.

    It requires exceptional leaders like Walt Disney to create significantly contrary work environments allowing heightened empowerment of employees. ( He used to call them ‘Cast’ to bring in ownership and pride in one’s work!)

    So, what could we do in our own life and organisations to empower and trust folks around us?

    Shakti

  21. Shakti …

    On Walt Disney properties, staff is still called ‘cast.’ My youngest daughter works in Disney World. If everyone had Walt’s vision and enlightenment, then all customers would feel valued.

    I believe the focus has to be less on the bottom line and more on customer relations. When that shift occurs, then I believe that the bottom line will naturally improve. But that’s just me: naïve, trusting, believing in leprechauns and pixie dust.

  22. Sad to say, I can relate (like every other commenter, apparently!!). Banking, in particular, seems to be very impersonal these days. It’s especially galling, because they all extol their “personal service.” Right.

    The new-fee-for-this, new-fee-for-that finally got to me at a bank where I’d been a customer for over 30 years. It used to be a local community bank. It’s since been acquired a ga-zillion times, and its headquarters is now up in Canada. The usual story. I closed my account and went elsewhere. I enjoyed their surprise and telling them exactly why when they asked, “May I ask why you’re leaving?” As another commenter mentioned, they count on your staying because it’s a hassle to change banks.

    Sorry for your bad experience, Judy. You’ve got plenty of company, but that’s hardly a consolation.

    1. Well, Mark, misery (me) loves company. Thanks for letting me know I’m not alone.

      While I’d like to take my business elsewhere, I don’t want to go from the frying pan to the fire. I went thru the fee for this and the fee for that with the bank I left a year ago. But I haven’t had any of those headaches with my current bank. So, I am being cautious.

      Hope your current bank appreciates you. It’s a bear when they don’t.

  23. . . . cheat me once, and you are dead to me.

    Well, not you; the colloquial “you”.

    That goes for companies and people. I don’t believe in second chances. Sometimes one does not have a choice, but even then, in this Internet age, it’s easier to spread the word, and a negative review carries more weight than a positive one.

    1. With the way that many companies devalue their customers, that would leave no one I could do business with. But I do agree with the point you make.

      While I did not name the companies, the bank is well aware of my feelings as I put much of the same wording in a letter to them as are on this post. Yes, I’ve spread the word. 😉

  24. Tell me about it! I have changed banks three times already! I needed to write a stinker to the CEO of our satellite television provider to get them to replace our brand new and malfunctioning box after weeks of complaint calls fell on deaf ears. It is the attitude more than the money or even wasted time that is maddening. But like you say our choices are limited. I thought it was much better in your part of the world. Obviously not.

    1. Sad to say, Madhu, but the stinkers live all over. They will only change their attitudes for the better when they have an incentive to do so. Apparently the loss of customers is not one of them. Sorry you’ve had that trouble with your bank and your satellite TV provider.

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