Freezing in NH

After using ING’s Electric Orange account for a bit (since the Netbank debacle last fall) I figured I’d share my thoughts.

The website is relatively easy to use, though sometimes it takes me an extra click or two to find a feature.  The billpay works great, I like that it reminds you what you paid last time when you are setting up the next payment.  It’s quite easy to have multiple accounts and change the nicknames on those accounts (”emergency fund”, “vacation”, etc).   It’s easy to set up recurring transfers from one account to another.  All these are great features for saving and paying bills.

Now the downside: no checks.  This isn’t a big deal if you’re paying VISA for example.  You put your account number in the little box and click “pay”, and VISA handles it quite nicely.  But I live in a relatively small town.  When you get your water bill it doesn’t have a return envelope.  You’re expected to take the two part form down to town hall where there is one clerk and have her take your check and stamp one half of the form as your receipt.  I suppose mailing a check is acceptable, but the water department doesn’t have account numbers, just name/addresses, so I don’t know what I’d put for account number (can I fit my whole name/address in that box?) nor do I know what they’d do with the billpay at town hall.

So, to make my life easier (hah), I now have two checking accounts.  One is Electric Orange and the other is a local account with real checks (but no interest).  It makes it easy to deposit checks and cash, and to write checks for occasional things like the quarterly water bill or the handwritten renewal notice for a local magazine.  I can transfer money to/from Electric Orange using ING’s system.

One other interesting thing that has turned up is the difference in overpaying my mortgage.  I have a standard first mortgage and then a second mortgage which is technically a home equity loan (I got it at the closing, and it has a 30 year amortization).  Both are with the same company.  Both have tickets you’re supposed to send in with the check indicating the amount of the check that’s for “current payment”, “principal”, and “late fees”.  But those tickets are different and go to different places.  And when I overpay my primary mortgage using the E.O. billpay they apply the overage (without a ticket to guide them) to the principal. 

When I overpay the second mortgage, they apply it to the next payment.  It took a while for me to discover this, but my last bill from them showed my next payment due in August.  In other words, the amount I’ve overpaid in the last six months is equal to the payments for April, May, June and July.  Oops.  Anyway, to make a principal-only payment, I have to send a letter asking them to apply the enclosed check to principal, and send it to different address.  Hard to enclose a letter with billpay.  So I’ll be using my local account for that as well.

Today I got an email from ING reminding me not to write any more paper checks from the Netbank account.  Paper checks written after Dec 7th won’t be honored.  Now I know this from a letter and email they sent, but maybe that reminder should have gone out Dec 8th, not Dec 11th. 

Also, I got my packet of ING info (new account number and such) for the Netbank account on Monday.  It was all put into the same login account as my existing savings and Electric Orange account, so I didn’t really need the packet, but if I had needed the packet I would have been much happier getting it Friday before the other account was inaccessible. 

It just seems like they’re a little behind, which I guess is understandable considering how many accounts were involved, but sending an email is pretty easy no matter how many people are involved.

So I called my payroll department to double check that the direct deposit was correct for next pay period…nope.  While their system shows it as actived and in “prenote”, it wasn’t.  If I hadn’t called, they would have kept depositing into the old Netbank account that won’t be there anymore.  So I’m to expect a paper check for Dec 15th and direct deposit for the 31st.  Argh.  So doing online like they requested doesn’t work, and calling them is the only way.  Good thing I didn’t trust the confirmation.

Are you tired of hearing about Netbank yet?  I’m tired of dealing with it.  So I put in a request with my payroll department about two weeks ago (when they told us how quickly our Netbank account was going away) to have my direct deposit switched over.  So today I check and, oh yes, they’ve still deposited it to Netbank…which is fine for today but not so fine for two weeks from now.  Another call to make today.

When I logged in to Netbank to check (after not finding the money at ING) I saw a new message:

Effective December 3^rd, 2007, the Consolidation Service will no longer be available. The Financial Institutions previously designated by you (external accounts) will no longer be able to access your NetBank account information and no further external (ACH) transfers will be processed.

So…wouldn’t it be nice to find that out before, oh, the last business day before it happens?  I have bills scheduled to be paid from ING (since I assumed that my paycheck would be there) and of course their ACH takes a couple of days.  So today I scheduled a transfer of money (my paycheck) so the cash would be there for the bills on Dec 3-7 (they will transfer my Netbank account there the night of the 7th, so by the 8th all my money should be together).  But since it’s Friday, the transfer won’t take place until Monday, and it’s unclear from the above message whether ACH stops at 12:01 am on the 3rd, or 12:59 pm.  Ah well, I’ll find out.   That’s what the overdraft line is for I guess. 

I received an email from Netbank this afternoon reminding me that my Netbank ATM card won’t work after Friday 11/23.  Yet again there is no info in the email about how to get another one.  I really think this is a place where their process could be improved.  All they give you is a phone number for questions. 

How hard would it be to suggest (in the email) opening an Electric Orange account?  If necessary they could segment their population and only send that email to the people they actually wanted.   (They opened an Electric Orange account with the highest overdraft line for me with no questions, so it’s not like they’re trying to lose my business.)  Or if they can’t be sure to hit all customers that way, they could at least send a followup email the same day to the customers they want to keep. 

I imagine their phone line is clogged with people saying “but my new card hasn’t arrived yet” and the CSR has to keep saying “and it won’t unless you open a new account”.  I suspect next Monday will be busy as well…

The Simple Dollar talks about a two checking account system. This is the way I’m going to be operating, at least for a while after the NetBank Saga*.

I loved my Netbank account with its interest, billpay, paper checks and prepaid envelopes for mailing deposits.  Electric Orange will still have interest and billpay, but no paper checks or envelopes.  While I already use billpay for many bills, there are a few I like to pay with paper checks.  For example our local water department…I’m not sure where I’d mail the check, I just go down to town hall once a quarter and pay them with a check.  I suppose I could use cash, or have ING send me a paper check to take down there. 

I never had any trouble mailing checks to Netbank, but there is always the possibility of something getting lost in the mail, so it’s worth getting a local account to do those sorts of things.  I’m currently looking at my options in town to see what will work best.  I suspect I’ll end up with a large bank since I’ll probably be moving soon and I’ve had a good deal of trouble with a business account at a local credit union (but that’s a saga for another day).

Anyway, my new Electric Orange debit card arrived last week and the PIN yesterday, so I should be all set.

*Short version of saga:
- Netbank collapses
- Deposit accounts purchased by ING Direct
- Short note from ING saying existing ATM card will stop working 11/23
- No other info on new ATM card
- Call ING: checking account will become savings account
- Only way to get ATM card is to apply for new Electric Orange account

Netbank has a notice up today saying that Dec 8th we’ll all have new accounts at ING Direct (okay, maybe other people are seeing other dates, I don’t know).  So any balance in the Netbank account as of Dec 7th will go to ING Direct.   None of the billpay will transition, so don’t schedule any bills for after that since they will just dissapear with no warning.  Not sure I love that, but at least they’re telling us a couple weeks ahead of time.  A month would have been nicer.

I called ING to followup the email that I got last week.  I also received a letter with a promotion for new ING customers to get $25 when they open a savings account and a copy of the same notice I got by email.  Doesn’t work for me since I already opened one for a bonus a while ago.

I only waited on hold about two minutes, and the automated system cuts in to give you estimates of how much longer you wait, so it was pretty painless.  I spoke with Allison who suggested opening an Electric Orange account using the ING website and linking it with my Netbank checking.  Then I would have an ATM card from the EO account and could keep using the Netbank account as well for checks and direct deposit.  

We chatted for a few minutes and she said that all of the Netbank checking accounts will be transitioned to Electric Orange eventually, “probably at the end of November or first week of December or so”.  So if I did nothing, I’d only be out an ATM card for a couple weeks.  Apparently checks/direct deposits on the old account are honored for 6 months according to FDIC rules, but the actual account can be transitioned sooner. 

So I’ll go ahead and open an EO account this week to get the process started.  I just wish they’d written the notice to make the rest of the info clear to people.  I still think it was poorly done and could cause people to get more upset than they need to be. 

I had a Netbank account when Netbank went under and was aquired by ING Direct.   I got an email today asking me to sign up for an ING savings account (I already have one that I opened a couple years ago to get the $25 bonus) and in the email was this statement:

At the bottom of this email is a notice containing some very important information about changes that will be taking place to the accounts we obtained. Please take a moment to read this notice, as it affects how you use your account.

So, at the very bottom of the email, was this:

IMPORTANT CHANGES TO NETBANK MONEY MARKET, NET VALUE INTEREST CHECKING, and SUPER VALUE INTEREST CHECKING ACCOUNTS

Effective 11/23/2007 (”Effective Date”) we will no longer process ATM transfers (including withdrawals) and point of sale transactions (including online and cash-back transactions) that you initiate using an ATM or debit card that accesses a NetBank Money Market, Net Value Interest Checking, or Super Value Interest Checking Account that was acquired by ING DIRECT on September 28, 2007. This means that on or after the Effective Date your NetBank ATM and/or NetBank VISA® Check card(s) won’t work.

If you have any questions, please give us a call at 1-866-327-4599. For your convenience, we’re available from 8 AM - 8 PM, 7 days a week.

This is the kind of notice that should come AFTER a notice saying a new ING Direct ATM card was on it’s way.  So far, I have nothing from them about any new ATM card.  I am quite busy this week, but if I don’t have either a new card or a notice that one is on its way by Monday, I’m going to give them a call. 

edit: followup here.

Could they lose $900K?

Quite the sensationalist headline, since the answer was already “no” by the time the article was written.  Quick summary: they had a million in deposits, of which $100k is FDIC insured.  But Netbank wasn’t a total loss, so the FDIC has already handed over 50% of the amount over 100k.  But the headline “firm stands to lose somewhat less than half their cash” doesn’t sound that impressive.  And 900K sounds better than 450k.  Also I’m sure the editor rejected the first title “idiot stands to pay $450k stupid tax”.   

Applied Cognetics, a software development and online marketing firm based in Brooklyn, N.Y., has about $1 million in deposits in NetBank, an online bank with $2.5 billion in assets that regulators closed Friday because of an unsustainable level of mortgage defaults.

Although the FDIC insures bank deposits of up to $100,000, Applied Cognetics president Chris Colthrust and his four business partners aren’t sure what will happen to the remainder of their account.

“Every penny I saved for the last 10 years was in this,” said Colthrust, 39. “Basically all of our operating funds and accounts were in that bank. Everything we’ve worked for the last 2 years [could be] up in smoke.”

I guess I’m big on personal responsibility.  And I’d be more sympathetic if I hadn’t heard bad things about Netbank’s stability recently.  I don’t exactly live on Wall St, so if I’ve heard it was in trouble that fact shouldn’t surprise anyone.  Maybe you should keep an eye on things if it’s that important to you.

There are large banks that cater to businesses that have extra private insurance on their deposits to cover the amount above the FDIC insurance.  If you need to keep a cool mil in the bank for some reason, perhaps you should investigate such things.