Total Pageviews

Wednesday, October 10, 2012

How Checking Account Fees and Terms Vary by State


No one likes to pay bank fees. And they are even more annoying when it is clear that the amount and variety of fees can vary depending not only on where you bank, but also on the state where you live.

The Pew Safe Checking in the Electronic Age project, part of the Pew Charitable Trusts, recently analyzed the fees and terms offered to consumers in the 50 states, using the country's 12 biggest banks by deposits. (The 12 are Bank of America, Wells Fargo, JPMorgan Chase, Citibank, U.S. Bank, PNC Bank, TD Bank, SunTrust, BB&T, HSBC Bank USA, Regions Bank and Capital One. Together, these banks held nearly half of the country's deposits as of October 2011.)

The center created a tool that allows comparison of what is paid in one state with national medians. (Each state was evaluated based on the banks that had a retail presence there; no state has all 12 banks.)

Nationally, for instance, Pew found that 89 percent of checking accounts had a monthly fee. The median fee was $12, and the median minimum balance amount necessary to avoid the monthly fee was $2,000. The median length of a bank disclosure, meanwhile, was 69 pages. And the median number of “extra” fees - categories beyond the 12 most common fees charged by many banks - was 26.

But a quick look at Pew's state-by-state map finds significant variation in those numbers. Arkansas, where I live, pretty much tracks the national median, except for the minimum balance requirement. (It's higher here, at $2,500.) And it's a bit more fee heavy, with 34 extra types of charges.

Compare that with Massachusetts, which has a median minimum balance requirement of $6,000 - the highest amon g the states - but fewer additional sorts of fees (11).

In both of those states, the most you could pay in a single day from an overdraft - that is, overspending an account - is $140. But the “worst case” situation, which occurs when you don't cover the shortage within a certain period of time and incur extended overdraft fees, is very different: $1,015 in Arkansas, versus $1,420 in Massachusetts.

South Dakota and Alaska, meanwhile, top the list for the median length of disclosures (129 pages and 148 pages, respectively).

How does your bank compare with those in your state, and with big banks nationally?