Want a free checking account?
Better shop around.Analysts say many banks around the country are adjusting their fees, at least partly in response to federal legislation that could go into effect next month that aims to sharply reduce financial institutions' take from debit card transactions.According to Moebs Services, an Illinois-based bank data consultant, fewer U.S. banks and credit unions are offering free checking without any qualifications, such as keeping a minimum balance. In a survey last August, Moebs found that 72.5 percent of 2,265 financial institutions had a completely free option, compared with 83.5 percent a year earlier.The decline was greater among the largest institutions, said CEO Mike Moebs, and a more recent survey, released in March, found that only about half the big, publicly traded banks offered free checking.Skinflints shouldn't give up on getting something for nothing, or nearly nothing. Moebs says the best bets for free checking are community banks and credit unions, whose costs for operating checking accounts are generally lower than the biggest banks. And consumers can also avoid monthly maintenance fees on checking accounts with just a little research and by taking advantage of breaks that most banks offer.For example, Bank of America last month raised the monthly maintenance charge on its MyAccess checking account from $8.95 to $12. But it waives the fee if the account holder does just one of the following: makes a direct deposit of at least $250 each month; keeps an average daily balance of $1,500 or more; or links the account to other savings or investment accounts that have as little as a $2,000 daily balance.And then there's Frost Bank's checking account, cleverly named Free. It's free, period. And it includes online bill paying, not always offered on other banks' least expensive accounts.Still, free checking is slowly eroding. Of the five biggest Tarrant County banks, only Frost offered a completely free account, and even there a spokeswoman added: "However, we continue to evaluate all our checking accounts on a regular basis."There's a lot of interest in consumer banking fees. Just last week, the Senate voted to allow the Federal Reserve to move ahead with a plan to slash debit fees that merchants pay when consumers use debit cards. It's expected to cost banks about $12 billion a year after it takes effect July 21, and most bank industry analysts predict that financial institutions will try to recoup the lost revenue with higher fees elsewhere.Checking accounts seem to be No. 1 on the list."When politicians say they're going to force banks to lower their fees, what's the first thing to go? No more free checking," said Greg Morse, CEO of Worthington National Bank, which has three Tarrant County locations. "The free account is going to be a dinosaur," said Morse, whose bank does not offer a completely free checking account.But Lonnie Nicholson, president of the EECU credit union, which has 12 Tarrant-area branches, said he expects to continue offering a free checking account. Still, he agrees that "there will be a financial impact" on all financial institutions from the fee cut.Greg McBride, a personal finance columnist at Bankrate.com, said he expects a compromise between those views."Free checking is not going to go the way of the dinosaur," he said. "But we've already seen a turn that indicates it will be less available."McBride also expects debit card rewards programs, such as cash back or other discounts, to be scaled back. But of all the likely responses banks will take to the debit fee cuts, the loss of free checking will probably hit consumers the hardest, he said.Free is out thereIn a recent survey, BankRate.com found that 39 of the nation's 50 largest credit unions offer free checking. All but one of the other 11 waived the fee with direct deposit, paperless statements or both. And 27 didn't require a minimum dollar amount to open a free checking account.But just like getting a better deal on a credit card, consumers need to get proactive in seeking better banking deals.The National Foundation for Credit Counseling in a March survey found that 51 percent of consumers indicated they would shop for another bank if their existing bank raised fees on checking accounts.What they say, however, might not square with what they do.According to a survey released March 1 by J.D. Power and Associates, 8.7 percent of consumers said they switched their primary financial institution in the past year. That inched up from 7.7 a year earlier.Even then, pricing -- fees and interest rates -- carried "relatively little weight" in consumers' decisions, even with heavy media coverage of banking fees. Instead, the "blunt instruments" of marketing, branch network and giveaways like gift cards were more influential, said Rockwell Clancy, vice president of Power's financial services practice.And the credit counseling group's survey found that 16 percent of respondents said they wouldn't even notice if their bank raised checking fees, while another 11 percent said they would notice but simply accept it. Another 16 percent said they would at least complain to the bank.Jim Fuquay, 817-390-7552Tarrant banks
Here are ways to get a free checking account at the five largest banks in Tarrant County. Listed are accounts that allow online banking and online bill paying with minimal restrictions to avoid a monthly fee.
Frost Bank
Free: No restrictions
Bank of America
eBanking: Free with direct deposit, use of ATMs only for other transactions and paperless statements. Otherwise, $8.95
BBVA Compass
Build-to-Order: Free with direct deposit of $300 or more or $1,500 minimum balance. Otherwise, $8.95
Chase Bank
Total Checking: Free with monthly direct deposit of $500 or more; or $1,500 minimum balance; or $5,000 or more in other deposits/investments. Otherwise, $12
Wells Fargo
Custom Management Checking: Free with direct deposit; or $1,000 minimum balance; or regular automatic transfers to savings account. Otherwise, $10
Sources: The banks
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