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I recently opened a new certificate and after less than two weeks I received a notice from the bank that they are closing my certificate because they've decided my mailing address is beyond their marketing area. Totally bogus excuse just to not honor the contract.

Is this allowed? Frankly I'm just flabbergasted that the bank even has the balls to try and tell me they are immediately closing out an account of this nature without my permission. I doubt it would instill confidence in their other customers.

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Generally, no, a bank cannot unilaterally terminate a CD on the basis of rates (see exception below). But there's also n... (more)

BEEFjerKAY (Jan. 17, 2010 @ 11:55a) |

Of course not. Because if the full details had been provided, it would have been more obvious why the FI took the action... (more)

BEEFjerKAY (Jan. 17, 2010 @ 11:59a) |

That's generally not the way it works.

Usually when an FI effects that kind of strategy thru other mechanisms, primarily... (more)

BEEFjerKAY (Jan. 17, 2010 @ 12:11p) |

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Since the CD is being closed early, are you being penalized ?

xoneinax said: Since the CD is being closed early, are you being penalized ?

Not as far as I can tell, but that's not the point. There's nothing in the terms that says they have the right to terminate the contract other than it saying "We may change any term of this agreement".

If banks could just go closing CDs willy nilly then every time rates went down they'd simply close out any high paying CDs and the whole purpose of opening a CD would be defeated. I thought the only way a bank could get out of a CD obligation was if they went under.

Should I fight it? Frankly I don't even want the CD, but I feel I should do something just based on principle.

What bank? Lets start a FWF boycott!!! LoL...

mrteeth said: Is this allowed?

Yes.

You don't mention the type of FI (bank, FSB, FCU, etc.), but auditors are doing a much better job of enforcing charters.

yeah, it's the sux0r duude. But it's legal and probably mentioned somewhere deep in all that fine print.

edit: I posted without looking to see who the op was. My bad. This is merely one of those inconsequential banking regs that op's CU proposal disregards. lol

Frankly, I doubt most other of their legitimate customers would care. And those that would care probably are not high lifetime value customers anyway.

BEEFjerKAY said:
Yes.

You don't mention the type of FI (bank, FSB, FCU, etc.), but auditors are doing a much better job of enforcing charters.

yeah, it's the sux0r duude. But it's legal and probably mentioned somewhere deep in all that fine print.


Read the title, it's a bank, and like any good FWFer I know how to read the fine print and it's not there. I understand that a bank has to follow it's charter, but that typically means writing terms and conditions which satisfy the charter. Breaking contracts on a whim isn't usually the way it works.

BEEFjerKAY said:
edit: I posted without looking to see who the op was. My bad. This is merely one of those inconsequential banking regs that op's CU proposal disregards. lol


Here we go again. Story of my life is I prove someone wrong and they follow me around talking crap to try and make themselves feel better. You have it backwards, I know it all too well the power of regulators as evidenced by this closure. You guys were the ones arguing that banking regs were inconsequential and that a lack of a profitable business model is the problem for a FWF CU. I was saying no it is possible to find a profitable business model, but banking regs won't allow it.

mod edit: edited for language

A bank can refuse to do business with any cusyomer it wants

This is no different than banks rejecting rewards checking accts from out of area applicants

I bet you tried to fund with a creditcard too... These small community banks dont want gamers

mrteeth said: xoneinax said: Since the CD is being closed early, are you being penalized ?

Not as far as I can tell, but that's not the point. There's nothing in the terms that says they have the right to terminate the contract other than it saying "We may change any term of this agreement".

If banks could just go closing CDs willy nilly then every time rates went down they'd simply close out any high paying CDs and the whole purpose of opening a CD would be defeated. I thought the only way a bank could get out of a CD obligation was if they went under.

Should I fight it? Frankly I don't even want the CD, but I feel I should do something just based on principle.


Just so I understand...

You want to spend the time fighting to get something back that you don't want.

If, "We may change any term of this agreement" is accurate, isn't that what they just did to you?

For your sake, I hope that you have bigger fights to fight.

SUCKISSTAPLES said: A bank can refuse to do business with any cusyomer it wants

This is no different than banks rejecting rewards checking accts from out of area applicants

I bet you tried to fund with a creditcard too... These small community banks dont want gamers
That can't possibly be the case since OP always makes sure that the bank profits from his action. Clearly they closed his CD because they want to lose money.

.. so much anger... ya, I remember the OP from a previous thread too..

Anyway, i can't answer the question since I don't have the T&C in front of me but every CD I ever opened have terms in there that allows early closure solely by the insitutions discretion. I just went to a random bank's site and found this line when I tried to open a CDWe may also close this account at any time upon reasonable notice to you and tender of the account balance personally or by mail

mrteeth said:

Read the title, it's a bank, and like any good FWFer I know how to read the fine print and it's not there.

Then just tell us banks name so we can take a look

or dont

We dont need another 1000 out of area abusers hitting this community bank eith out of area apps


Its unfortunate that op has some finance dealhunting ability but little acumen in implementing it

SUCKISSTAPLES said: A bank can refuse to do business with any cusyomer it wants

This is no different than banks rejecting rewards checking accts from out of area applicants

I bet you tried to fund with a creditcard too... These small community banks dont want gamers


That would be true except:
1. The bank didn't refuse my business. They entered into a business contract with me and are now trying to break it.
2. I didn't try funding with a credit card nor do they even offer that option. I opened with account in person with a personal check which cleared without a hitch.

mttatkns said: That can't possibly be the case since OP always makes sure that the bank profits from his action. Clearly they closed his CD because they want to lose money.

Exactly. Though why do I get the impression that somehow your little pea brain doesn't believe it?

InsuranceExpert said: If, "We may change any term of this agreement" is accurate, isn't that what they just did to you?

No they didn't. They didn't change the agreement or send me an updated copy of the agreement as probably required by their regulator. They kept the agreement as it was and then broke it, probably because if they changed it the regulator would probably require them to change it for all customers that have the same account.

I want to maintain my relationship with the bank long enough so they can calm down and see that I am a good customer (usually takes a few years).

Meltdown in aisle 5!

mrteeth said: Though why do I get the impression that somehow your little pea brain doesn't believe it?

Nicely demonstrates the difference between classic and classy.

SUCKISSTAPLES said: Its unfortunate that op has some finance dealhunting ability but little acumen in implementing it

Certainly a lot more acumen than you who posts your methods all over the internet for everyone to exploit. And unlike you my methods don't screw everyone over.

You, my friend, are a small fry in the financial deal hunting world.

BEEFjerKAY said: Nicely demonstrates the difference between classic and classy.

Never claimed to be classy, just right.

mrteeth said:
I want to maintain my relationship with the bank long enough so they can calm down and see that I am a good customer (usually takes a few years).

Looks more like you need to calm down

Especially since the bank actually did OP a favor. Locking up cash into fixed income USD denominated instruments is probably not the best way to increase wealth over the next few years. But hey, what do I know? I'm just another random goof posting in the finance area of an internet grocery coupon swapping site.

If anyone could point me to a good graphics card that's 100% compatible with Windows 7 64-bit, I'd sure appreciate it. And I'd gladly crawl back under my bridge for a few more years.

BEEFjerKAY said: Especially since the bank actually did OP a favor. Locking up cash into fixed income USD denominated instruments is probably not the best way to increase wealth over the next few years. But hey, what do I know? I'm just another random goof posting in the finance area of an internet grocery coupon swapping site.

If anyone could point me to a good graphics card that's 100% compatible with Windows 7 64-bit, I'd sure appreciate it. And I'd gladly crawl back under my bridge for a few more years.


Is that all that's keeping you on here. New graphics card and back to WOW?

mrteeth said: Is this allowed?
Yes it is.

mrteeth said: Frankly I'm just flabbergasted that the bank even has the balls to try and tell me they are immediately closing out an account of this nature without my permission.

Wow.
What happened with last guy who pissed you off?

Maybe this link will help you linky

mrteeth said: SUCKISSTAPLES said: A bank can refuse to do business with any cusyomer it wants

This is no different than banks rejecting rewards checking accts from out of area applicants

I bet you tried to fund with a creditcard too... These small community banks dont want gamers


That would be true except:
1. The bank didn't refuse my business. They entered into a business contract with me and are now trying to break it.

They can refuse your business after setting up the account. Its not like the only time a bank can ever decide they dont want you as a customer is PRIOR to signing up...they can kick you at any time during your time as a customer.

Whether they are liable for the contractual interest depends on their other terms and disclosures. As others have posted, most bank boilerplate allows them to terminate the customer relationship immediately and simply pay whatever the current balance may be.

mrteeth said: I recently opened a new certificate and after less than two weeks I received a notice from the bank that they are closing my certificate because they've decided my mailing address is beyond their marketing area.I really don't get the OPs reaction here. Clearly, the short duration between opening the certificate and notification shows that the bank is just doing due diligence here.

This reaction is like other people on FW who think they have a constitutional right to a price mistake.

SUCKISSTAPLES said:
They can refuse your business after setting up the account. Its not like the only time a bank can ever decide they dont want you as a customer is PRIOR to signing up...they can kick you at any time during your time as a customer.


I've never read anything so ridiculous in my entire life.

Can the bank cancel your mortgage at any time under the premise that they don't want you as a customer? Obviously not because they are obligated to fulfill that contract. Of course before signing a contract everyone is free to do business with anyone they please including the bank. But after signing a contract you may be bound to business relationships you might otherwise wish to terminate.

So no, they absolutely cannot terminate the relationship at any time. Not under the terms of our agreement.

SUCKISSTAPLES said:
Whether they are liable for the contractual interest depends on their other terms and disclosures. As others have posted, most bank boilerplate allows them to terminate the customer relationship immediately and simply pay whatever the current balance may be.


And what bearing do most boilerplate contracts have on my contract with this bank?

Is this how you do your AORs? If the CC company were to call you and say "oh well most CCs charge a high interest rate for balance transfers, so even though the terms of the account we gave you stipulate otherwise we're going to also charge you" do you accept that? The word retarded comes to mind.

btuttle said: I really don't get the OPs reaction here. Clearly, the short duration between opening the certificate and notification shows that the bank is just doing due diligence here.

When you purchase real estate do you do your due diligence before or after you sign all the papers at closing? I suppose there's no law that says you have to do it before, but if you don't it doesn't give you the right to terminate the contracts you sign at closing either.

btuttle said:
This reaction is like other people on FW who think they have a constitutional right to a price mistake.


Not even close. When's the last time a merchant signed a contract with you to provide a service at said price? If they did then wouldn't you agree that the purchaser would, in fact, have a constitutional right to that price?

You guys are sounding like the deadbeats who post here looking for excuses not to pay their bills. Fulfill your contractual obligations deadbeats!

Go take your meds, then have one of the Google apps read the banking regs to you.

As strange as it might sound, it can take some FIs up to 2 weeks to complete setting up a new CD, especially for a new customer. Sounds like your CD may have been kicked out during one of the final steps in getting fully set up.

Mortgages and CDs are apples and oranges, but w/e.

op if you are so certain what ghey did is not allowed , why did you post this thread?

Dont be mad bc everyone has told you that it is you who is wrong

BEEFjerKAY said:
As strange as it might sound, it can take some FIs up to 2 weeks to complete setting up a new CD, especially for a new customer. Sounds like your CD may have been kicked out during one of the final steps in getting fully set up.


That's why regulators require FIs to have their terms and conditions in order. It's the way regulation of consumer interactions is enforced: regulator reviews terms FIs write for themselves and then FIs are expected to follow those terms.

If they closed the account during account setup to comply with their charter then the FI dropped the ball on this one by not writing appropriate terms and conditions, which could cost them fines from the regulator and a suit from me (damned if you do and damned if you don't...they should have written better terms). Obviously they could have still weaseled their way out of the CD because as I previously noted they could send me updated terms at any time, but the problem is that they didn't; They closed the account while the old terms were still in effect, which is a violation of their contract with me and probably also a violation of their charter.

SUCKISSTAPLES said: op if you are so certain what ghey did is not allowed , why did you post this thread?

For advice on the best way to punish them:
-Email to bank president?
-Report to regulator?
-Threaten suit?
-File suit?
-Expose unprofitable loopholes to FWF community?

do them in that order and report your results

The last step should have been the fwf rant thread or brag thread depending on yiur outcome

I've had banks that closed accounts for me after they decided to focus on and market to customers in their area. But that was after a rate guarantee on the account had ended, so it didn't bother me all that much. My other banks that have subsequently restricted accounts to local customers have left my accounts intact. I can understand the OP's frustration at having his CD closed, especially if the rate was favorable. Still, the bank likely can do what it did to the OP.

The best bet seems a polite letter to the president of the bank (but I'd do snail mail rather than e-mail), describing the situation, stressing that OP wants to do business with the bank, and requesting that they honor the CD under the terms it was opened with. Though if the letter shows the lack of restraint that the OP's insults in this and other threads do, then I fear that the attempt is doomed to fail.

mrteeth said: So no, they absolutely cannot terminate the relationship at any time. Not under the terms of our agreement.
Good. Then go hire a f'ing lawyer and sue them and quit wasting our time, because obviously you know everything.

OP take a deep breath and relax. First off, it is ok to be pissed at them for doing this. Most of us in your shoes would have been pissed also. But then how we react to the situation is where each of us differs. In plain simple english, Banks are allowed to change terms and even drop agreements if they so please to do so, the very terms and conditions sneak in this clause. Also taking your mortgage example, even though we may have signed a 15 or 30 yr mortgage, nothing stops us from refinancing to another bank at a better rate (even though we had originally signed a 15/30 yr agreement with the original bank). People do this everyday, banks don't seem to be holding a grudge against us.

Further, this works much the same way as us jumping from bank to bank chasing high interest rates and bonuses, imagine how pissed the banks are at us, when we collect the bonus and leave a $2 balance and jump to the next bank. Don't waste more time over this (you can give Glx's advise on writing to the President of the bank a shot though, it may work), if it doesn't then look around for good interest rates and move your money. Or if you fancy try the reward checking thread and open a RCA, that way your money is not tied in as it would be in a CD.

PS: There is no reason to be annoyed at other members here, its not like they are the employees of the bank arguing with you , they are sharing the facts of how these things work. Ok folks (as well as the OP) no more bad blood on this thread please.

The OP has every right to be pissed off. He may possibly have legal grounds, but if so, it is probably not worth pursuing.

mrteeth said: If they did then wouldn't you agree that the purchaser would, in fact, have a constitutional right to that price?
I don't believe our constitution covers such issues

whatever all the personal back and forth, I think the OP raises a good question:

Can a bank unilaterally terminate a CD at any time for any reason? If so, what is to prevent them from doing so on the basis of rates alone? Surely that can't be permissible.

SUCKISSTAPLES said: A bank can refuse to do business with any cusyomer it wantsEven if the person belongs to the "wrong" religion or race?

larrymoencurly said: SUCKISSTAPLES said: A bank can refuse to do business with any cusyomer it wantsEven if the person belongs to the "wrong" religion or race?
Sure, They don't need any reason so they just wont say thats why they closed.

OP you never provided the name of the bank...

larrymoencurly said: SUCKISSTAPLES said: A bank can refuse to do business with any cusyomer it wantsEven if the person belongs to the "wrong" religion or race?

No.

RS4Rings said: They don't need any reason so they just wont say thats why they closed.

In some cases the FI may be prohibited from providing a reason.

psychtobe said: whatever all the personal back and forth, I think the OP raises a good question:
Can a bank unilaterally terminate a CD at any time for any reason? If so, what is to prevent them from doing so on the basis of rates alone? Surely that can't be permissible.


Generally, no, a bank cannot unilaterally terminate a CD on the basis of rates (see exception below). But there's also no evidence OP had a valid CD or even that it had completed the process of being opened.

In the case of an FI that has gone into receivership (such as what happens when the FDIC moves in to take over a "bank" or to effect a transfer of account assets to another FI), the receiving FI does have the contractual right to unilaterally change the terms of above market rate CDs ... and often does.

Skipping 2 Messages...
RS4Rings said: larrymoencurly said: SUCKISSTAPLES said: A bank can refuse to do business with any cusyomer it wantsEven if the person belongs to the "wrong" religion or race?
Sure, They don't need any reason so they just wont say thats why they closed.


That's generally not the way it works.

Usually when an FI effects that kind of strategy thru other mechanisms, primarily focusing on pre-empting new accounts. Closing accounts that have already been established is highly problematic.

But I'm not going to turn this into a primer on how to manipulate the system to scr2w over people who "belong to the 'wrong' religion or race". Trust me, the boys and girls who want to do that already know how.

Regardless, there's no evidence that OP was the victim of that kind of shady practice.



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