Beware of Bank of America: screwing the customer as a business model

From time to time I have reported on examples of unethical practices and/or examples of horrible customer service from Bank of America. Bank of America is certainly not unique in its practice of predatory lending, use of high fees, use of taxpayer bailout money for CEO bonuses, etc. But they are certainly one of the worst examples. For a rundown of my previous summary of how bad Bank of America is, check out this article:

Bank of America Seems to Like Pissing off Americans

Looking for updates on this rundown (after all, Bank of American sure hasn't been improving its customer service), I just found a mother lode of complaints about Bank of America from regular consumers like you and me. Like all things on the internet you have to realize that not everything will be accurate, but given the existing well-established record of predatory lending, high fees and poor customer service, I am willing to bet most of these comments are accurate. Here are some samples of what regular customers are saying about Bank of America:

[NOTE: This is just a few examples from November and December 2010...needless to say the complaints go on and on]

Bank of America illegal/unethical activity-credit line
Bank Of America Complaint by Bwm27571

Today, Bank of America has put a status on my tradeline/credit indicating that I am 30 days passed due on my mortgage. I made a full payment in November. Coincidentally, I am in process to get a refi through another bank and this bank called me today, 12/13, and informed me that BofA put a status on my credit line of 30 days overdue on payment. My bank statement clearly shows a total full payment made. But Bank of America is somehow, interferring with my refi. Is this illegal by BofA knowing that I made a full payment?

BOA is stalling home loan modification
Bank Of America Complaint

I have been working with...well really against boa for loan modification. This has been going on for well over a year.they say they have no record of request for modifavtion even though I have the documents in my hand. Then they get my papers and intentionally do not scan in all docs. Everytime I call its "we are missing ..this or that.." the same crap I keep sending over and over. Its always " its being escalated..or under review" . We are not *** boa..we all know you stall to force people to spend the money to refi! There has to be a way to complain and be heard! Think I will start contacting congressmen and other agencies and start filing complaints about boa in every forum I can!

[NOTE: I had a similar experience with a refinancing with Chase where paperwork was not handled appropriately and they kept losing stuff and consequently charged extra fees and raised the interest rate on me almost every time I talked to them...ultimately I refused to refinance with Chase and refinanced with TD Bank instead. The paperwork was still a nightmare but they offered a good rate and kept it there]

Late fees when mortgage was on time
Bank Of America Complaint

B of A has consistently charges us late fees even when the mortgage was on time. Interest was charged on top of that, then they took our payments and applied them to the bogus late fees. I have sent receipts over 10 times, and finally after 2 years, they reimbursed most of the late fees, but did not re-amortize the loan from the point of their mistake, and are consistently charging fees on top of fees. You can't talk with anyone, they are all in California, and you have to leave a message. They sent me a letter stating I needed to call someone, and the phone number is the same on I've been leaving messages on for over 10 weeks. No wonder people are walking away from their homes. This is very frustrating.

And a comment to that complaint agrees:

The same thing just happened to me. I made the payment over the phone with a live person he assured me there were no late fees. Then I get aletter in the mail saying I have been charged a $91 late fee. I called immediately and as soon as I told the girl exactly what happened she immediately apologized and credited the charge without further question. I guess they are just trying to see who falls for it. I HATEBANK OF AMERICA!!!

Hidden Costs
Bank Of America Complaint by Atash

Whenever one chooses a service with them, there are many hidden costs that one will only discover once paid.

For example, I canceled 3 lost checks, and now I discover that I paid a fee of 30 Dollars for it, where as there were no mention of such a fee at the moment of my request.

Another example: I opened an saving account after asking if there is "any fee", and they told me no.Then I found out, if there is less than 600 Dollars on your account, there is a monthly fee that one need to pay.

The worst is their client service: they told me that "we can close your account if you are not happy with our service!"

[These hidden costs are common...even Astoria, otherwise a decent bank, screwed my son with hidden costs. I have found TD Bank and USAA far better on fees than most, but I do know someone else who found TD to have some hidden costs as well.]

Bank of America ripped us off on refinancing
Bank Of America Complaint by Morgannick

We recently started a refinance process with Bank of America. We wanted to refinance into a 15 year fixed rate loan with a interest rate of 3.75%.

James Stennett, a loan specialist, told us that we would need an appraisal of at least $160,000 to meet the requirements. I think ok no problem...I understand the price of homes has declined but we paid well over $160,00 for our home and our current listed value as of this month was $171,000 which is still well under what we paid for it.

Bank of America sends out their appraiser and while he is here I get papers in the mail from Bank of America with my appraisal amount listed in there as $165,000. I called James and asked why I would pay $450 for an appraisal if he hasn't even performed it yet and they already have the appraisal amount. Oops...that was just a automated letter that is sent out, they just guestimated what my home is worth.

So a couple more weeks pass and I have no word on what my home appraised at even though I was promised that I would have a hard copy of the appraisal within 4 days, so I call once again. Now I'm told that my house has appraised at $153,000 and I don't qualify for the refinance but they can work out some different options for me.

The best part of the whole deal is that I still get to pay for a credit check and the bogus appraisal to the tune of $485.00. To add insult to injury James Stennett took the time to explain to me that my homes value was an average of 3 homes that have sold in the "area", not in my development that were smaller than my house. He explained that I did get a little credit for my house being bigger than the ones they compared it to. I wonder why they didn't average in the house that is on my street that is the exact same size as mine that sold for $188,000 this month. Guess they could be honest with their consumers and tell them they are going to pay $450 for a appraisal that is basically just them making up numbers so they have an excuse to charge you a higherinterest rate. They are crooks and I truely believe that they just stole my hard earned money.

[NOTE: The appraisal is done this way by other banks as well, so this should be taken as a general warning when getting a mortgage, but some banks have more reasonable fees and sometimes don't charge so much up front, only if you get the loan...so take these fees into account when applying.]

Bank Of America took their house...beware!
Bank Of America Complaint by Suebru2448

This is just another SAD story regarding Bank Of America and they're slimey ways! My friend had a home loan with Country Wide for 12 years. Never missed a payment. When Bank Of America took over the servicing of their loan, they received a check for around $8000. Bank Of America told them it was their money and to cash the check. A mix up with their escrow and Country Wide was taking too much escrow all those years.

They were scared and held on to the check for 5 months. Calling Bank Of America 18 times during that 5 months to make sure it was not a mistake before cashing the check. They were told to hurry up and cash the check because it would be void after 6 months. They cashed and spent the money (paid off some other bills, medical..etc) 4 months later they get a certified letter from Bank Of America stating they owed them the money back within 30 days. They didn't have the money and told them that. They were told you have 30 days. They asked the bank if they could pay an additional $200 a month with their mortgage payment.....nope....we'll give you 10 months, meaning an additional $800 a month on their payment. They couldn't do it....4 months later got foreclose papers and now theirhome has sold at auction.

Sad thing is, they bought the house for $152,000 12 years ago. Owed $98,000 and the house sold at auction for $56,000 by an investor. Are you kidding me? Seriously, something must be done with this bank!!!!

[NOTE: Many funding agencies buy and sell mortgages, so even if you get a mortgage with a good company, it may get sold to a big bank who can screw you like this story shows. Some banks, TD Bank for one, does not do this as far as I can tell, so the company you deal with and the terms of the loan stay more constant. That is something you can ask when financing: do they buy and sell their loans or will they always be the ones managing it.]

I should note that I have seen some individual examples that suggest Wells Fargo might be worse than Bank of America. In particular the story of Wells Fargo preying on a mother in North Carolina whose scalded baby was in the ICU and examples of particularly horrible and racist predatory lending in Tennessee. But for sheer volume of complaints, Bank of America ranks the worst. Here is a breakdown of which banks get the most complaints from customers according to the Office of the Comptroller of the Currency: (via the Stop Bank Abuse website)

Bank of America: 7,230 complaints (25.5% of total)
J.P. Morgan Chase: 4,890 complaints (17.3%)
Citigroup: 3,742 complaints (13.2%)
Wells Fargo: 2,695 complaints (9.5%)
HSBC North America: 1,963 complaints (6.9%)
Wachovia: 1,265 complaints (4.5%)
U.S. Bancorp: 1,027 complaints (3.6%)
National City: 586 complaints (2.1%)
The Royal Bank of Scotland Group: 537 complaints (1.9 %)
Key Corp: 343 complaints (1.2 %)

Total Top 10 complaints: 24,278 complaints (85.7%)
Total complaints: 28,316 complaints (100%)

Bank of America is by far the worst in terms of customer service complaints of any of the banks.

Again, as I keep emphasizing, Bank of America, Wells Fargo, Citibank and Chase are all examples of banks that screw customers, screw the taxpayers, support right wing politicians and pay huge CEO bonuses while foreclosing on working and middle class Americans. And they just plain have fees that are too high and lousy customer service. Some readers tell me they have found good local credit unions, and I certainly encourage looking into credit unions in your area. I have not tried it but here is a Credit Union Locator to help you. Personally I have found USAA (available to families of military personnel), US Bank and TD Bank to be good alternatives to the predatory lenders with poor customer service and high fees. My wife likes Astoria though we did have one bad fee/customer service experience with them. Many areas also have local banks worth looking into.


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