Online Banking Doesn’t Always Work
Online banking services, however, could be closed during the failed bank’s transition. In the case of an Internet bank failing, consumers with deposits held by the bank may be more limited in the account management tasks they can perform. The FDIC does try to make sure web-based banking services associated with a failed bank remain continuously available.
Services and Accounts That Automatically Transfer to the Acquiring Bank
Despite the possibility of your bank failing becoming a headache, there are a few automatic transfers that will prevent your “to do” list from getting any longer. If you had automatic payments, loan payments, or direct deposits for your paycheck scheduled to occur regularly, those services will continue without you lifting a finger. Any trust accounts held at the failed institution will also be automatically transferred to the acquiring institution.
Though Bank Failures Make More Headlines, Credit Unions Fail As Well
The NCUA is the credit union version of the FDIC and functions in much the same way when a credit union becomes insolvent. Credit unions have a few more exemptions in the tax arena than banks, but they aren’t necessarily a safer place to hide from institutional failure. The NCUA’s guidelines for insurance coverage are similar to the FDIC and have insurance limits of $250,000 per member, which could be more depending on the type of account ownership.
Be Thankful for FDIC and NCUA Insurance
Finally, if you are one of the millions of beneficiaries of the insurance provided by the FDIC or NCUA, be thankful that not one dime of insured deposits have gone unpaid. While every system has its limitations and imperfections, it is a good thing that consumers don’t have to constantly think about how to secure all of their money.
Should you take advantage of the above lessons, you’ll be better prepared for and know how to respond when your bank is in the headlines for “Latest Failure”. Hopefully, though, some of the tools introduced will help you avoid such a scenario altogether. Check out more tools and lists on the failed banks page of the FDIC.
Patrick Russo writes for DepositAccounts.com, a website that monitors products and rates at more than 7,500 banks and credit unions and pairs that information with comprehensive commentary, reviews, tools, and community forums to equip and guide depository banking consumers.
(Photo courtesy of Andy Hawkins)
Article Appeared @http://www.savingadvice.com/articles/2013/08/01/1017501_bank-failures-25-things-everyone-with-a-bank-account-needs-to-know.html
Also Appeared @http://blackubiquity.com/business/item/15294-bank-failures-25-things-everyone-with-a-bank-account-needs-to-know