Wachovia Bank Troubles: How to Protect Yourself | Financial News

[ragschef]

Not sure how many of you are affected by this news but here are two articles regarding the troubles of Wachovia Bank, NA.


http://www.news-record.com/content/2008/07/22/article/wachovia_posts_886_billion_quarterly_loss


http://money.cnn.com/2008/07/17/news/companies/wachovia_raid.ap/index.htm?cnn=yes


I hope no one is effected by this news. My suggestion (as a banker): GET OUT WHILE YOU STILL CAN!!

 

[dannyzmom]

Does this mean we should be pulling our $ out of Wachovia?
That is where I currently bank!

 

[ragschef]

I would suggest doing so. There's nothing int he news yet or in the rumor mill as to whether or not the bank itself is being inspected. The thing that is talked about in our meetings is that if their securities practices are questionable, their banking practices could be as well. Also, they are offering higher rates for lower amounts of money which basically means they are needing deposits to stay afloat. I just know that there is a lot more going on than is known.

 

[SummerG]

My ex-DH was laid off by them in May. He was a manager in the mortgage department. He worked for World Savings (which Wachovia bought out last year) for 7 years. He sensed that it was coming when Wachovia took over.

 

[SassyCook]

As long as your deposet is under the FDIC insured amount you don't have to totaly freak out. But it may take some time to get you money back. I would maybe start look for a new bank one that you go check out and google it. FDIC: Federal Deposit Insurance Corporation for more info.

 

[quiverfull7]

Our mortgage is with them and our daughter banks there. What effect would that have on us with only our mortgage there?

 

[ragschef]

Diane,
I would talk to a mortgage person and see if you could get some info out of them. I'm not sure how it woudl effect you or that it would. I just know that they aren't accepting any other mortgage apps and that the Feds could be inspoecting the bank soon. Not sure what could come of that. I personally would change if I could find a god rate with a more stable company currently. I just wouldn't trust them with everything going on. I've been in banking for a very long time and I've never seen a bank go thur as much trouble as wachovia is now. Then again, I've never seen our economy as bad off as ours is now.
I hope it doesn't affect you or your daughter.

 

[ragschef]

Here's an updated story that I just got.

http://www.news-record.com/content/2008/07/22/article/wachovia_posts_886_billion_quarterly_loss

 

[PampMomof3]

Does this mean we should be pulling our $ out of Wachovia?
That is where I currently bank!

Me too~ I've been wanting to switch but have been a member for over 13 years! I need to get a bank closer to home.

 

[ragschef]

Our mortgage is with them and our daughter banks there. What effect would that have on us with only our mortgage there?

From the article I just posted, it looks like any mortgages with Wachovia will be sold to another compnay which will probably mean that your rate (if its a fixed mortgage) will not change. You'll just change who you send your checks to. Hopefully, that would be all that happens.

 

[RebelChef]

I hope they do investigate their banking practices. I've been a customer for several years and have found they have some shady policies. I've taken screenshots of my account where a check/debit wasn't there and then the next day it was but it was posted several days prior, usually before a deposit. (Sometimes causing it to be an overdraft which costs me money.) I will say that they have refunded several hundred dollars because of this. The odd thing is they've never done it on my PC account. Now I only deposit enough money to cover my shows or any checks I plan to write. I would change banks but I still have 2 boxes of checks to use up. lol

 

[pampchefrhondab]

The banking problems are really scary. The major problem is these banks have given out huge mortgages with the plan of selling them off. Unfortunately nobody wants to buy them or invest in the banks right now because of the falling housing market. A lot of investing is going into futures instead. You may think you don't have anything to do w/that, but if you have a 401K or mutual fund you do. Much of the money is being moved around.

A run on the bank is not going to help. It will only make things worse. My sister works for IndyMac and that is what has happend to them. It's getting really ugly. The FDIC already took over. She will probably lose all her vacation time, benefits, etc. Not sure about retirement yet. Luckily she has only been there about 5 years. She still has a job, but probably only for 1 year.

I do blame these banks for loaning out too much money; however, why didn't the government stop it. They encouraged banks to loan out money because the strong housing market was the only big thing keeping our economy going. I also say shame to those who loaned more money then they would be able to pay back! Many people would just get interest only loans and not pay any principal on their mortgage. That's just crazy!

 

[ljeffries]

Your money and your mortgage are safe at Wachovia. I work for a top 10 bank (not Wachovia) - your money is safe! That said, are there problems, sure. One of Wachovia's main problems right now is that they purchased Golden West out of California. One of Golden West's practices was basically a 'pay what you want to pay' mortgage. That means that customers were paying less than the interest amount on their monthly mortgage payments. Also, many customers had equity lines of credit. While they were able to make their monthly mortgage payments, they were defaulting because of not being able to pay the equity line payment.
The mortgage crisis is nationwide. One of the problems is, too, that folks just stop paying their mortgage thinking that no one will notice....WRONG!
That said - if your money is in a FDIC secured institution, it is safe up to $100,000 per deposit account. When customers start running in to branches and taking all of their money out, then the real problems will begin!

 

[BethCooks4U]

Your money and your mortgage are safe at Wachovia. I work for a top 10 bank (not Wachovia) - your money is safe! That said, are there problems, sure. One of Wachovia's main problems right now is that they purchased Golden West out of California. One of Golden West's practices was basically a 'pay what you want to pay' mortgage. That means that customers were paying less than the interest amount on their monthly mortgage payments. Also, many customers had equity lines of credit. While they were able to make their monthly mortgage payments, they were defaulting because of not being able to pay the equity line payment.
The mortgage crisis is nationwide. One of the problems is, too, that folks just stop paying their mortgage thinking that no one will notice....WRONG!
That said - if your money is in a FDIC secured institution, it is safe up to $100,000 per deposit account. When customers start running in to branches and taking all of their money out, then the real problems will begin!

Thanks for this post it is exactly what I was thinking. The people who have had their money in banks that have closed have gotten the money out because of the FDIC insurance. A run on the bank will only cause more trouble and result in the bank closing for sure.

My son was considering moving his funds to a different bank (Wachovia was one of his choices) but chose to leave his money at Bank of America so that we could still move funds from our account to his (duh - I wonder why?). The banker said BofA is the largest and most secure but she also said that Wachovia, among others, is solvent and will survive this.