Consumers fight rising use of hidden fees

[CatWoman]

WASHINGTON — Hidden fees and surcharges that drive up the cost of everything from phone service to concert tickets are spreading like wildfire, creating a nuisance for U.S. consumers and making truth in billing little more than a hollow promise.

Some hotels impose automatic towel, bellman and grounds-keeping fees. Airlines charge up to $25 to check an extra bag. Want to terminate your cell phone service? Don't be surprised by a $200 cancellation fee.

Many of the charges are undisclosed, buried in contract fine print or listed as an unclear line item on a bill.

While the costly fees get our blood boiling, the smaller ones have turned the marketplace into a minefield of nickel-and-dime charges. These smaller fees typically range from less than $1 to roughly $10, depending on the goods or services involved.

For years, consumers ignored them because they were relatively small and weren't worth the hassle to fight. But multiply those small amounts by millions of customers and they become a multibillion-dollar corporate windfall.

A 2006 study by the Ponemon Institute, an independent business-research firm, found that the average adult pays about $942 each year in hidden fees and surcharges.

The study's results are featured in a new book, "Gotcha Capitalism," by consumer advocate Bob Sullivan, who called the fees the "fastest-growing white-collar crime in America," even bigger than identity theft.

After years of being squeezed, customers are fighting back. Just calling to complain satisfies many people. Others use Internet sites such as Complaints.com, PlanetFeedback.com, Callforaction.org and ConsumerXchange.com to help settle disputes. If those channels fail, they turn to the courts.

http://www.mcclatchydc.com/226/story/28752.html

[EFerrari]

1. My mom just told me she has to pay $500 for an appraisal

because she's applying for a reverse mortgage.

$500!

[FormerDittoHead]

3. ...She better have "title insurance"... another racket...

First off - $500 is a LOT for an appraisal...

But does she have title insurance?

My father was a lawyer and bought the house I live in.

He went to the court house and searched the title transactions for 75 years going back. It took less than an hour, including the travel time, like 4 records to look up, which I'm sure are all online by now...

But I couldn't get a home equity loan without shelling out over $400 for "title insurance"...

So not only do *I* have to get it, but then the NEXT guy will be expected to buy it too...

[EFerrari]

4. My mom is a commercial broker. If she's complaining

it has to be BAD.

[unblock]

14. title insurance is priced based on spreading out the risk

the lender doesn't know your father or whoever did the title search did it properly. for that matter, the court house's records might not be completely in order. one misfiled lien can ruin a purchase from ages ago. title insurance rarely comes into play, but when it does, it could cost someone a ton of money, possibly millions.

that said, if a title insurance company can keep its costs down and avoid its own screw ups, it can make a ton of money.

[ellenfl]

2. kicking for later perusal of those sites. thanks. eom

[DaveJ]

5. I think it's even worse than that.

Services like phones, cable, hotels, etc, should all advertise their total price, not price minus taxes and fees.

For example, gas stations advertise the exact price per gallon with tax built in -- the price they display is the price you pay, period.

I don't see why everything else can't build in the added fees and taxes into their advertised prices.

Just picture going to a gas station that said their gas was $2.50 per gallon, and then when you went to pay they charged taxes on top of that. Almost everyone would stop going there. Other businesses should act according to the same model.

[Skittles]

8. yes - we are ripped off for the price of gas

but at least the REAL PRICE is HUGELY DISPLAYED before we even start to pump :o

[LiberalEsto]

6. Bank fees

My daughters use debit cards and they are constantly getting hit with overdraft fees. This happens even when they check to make sure they have sufficient funds. The fees are now $35 for each overdraft.

[Skittles]

9. ?

something not right there, Liberal - are they forgetting something like, say, a monthly fee the bank is charging for not keeping a minimum balance, something like that? There's got to be something wrong with the accounting somewhere.

[LiberalEsto]

11. The banks sometimes put "holds"

on the money & all kinds of little tricks like that. You can deposit $100 cash one day and it might not be available for use until several days later.

[Skittles]

13. ok when did THOSE rules change?

when I worked in night-time bank data processing there were VERY RIGID RULES about availability - to the point when, past 24 hours, it went into "disaster recovery mode".

[Hugin]

16. It's been like that for quite awhile around here...

The world is "Pay-to-Play" now.

Just the way the Haves like it.

[Mountainman]

12. I had a credit union that hit me with over draft fees constantly.

I would use the debit card on the weekend. The charges never hit my account until I was over drawn on one thing toward the end of the week then they would post the prior weekends spending and so they all got hit with a $25 overdraft fee.


If they all were paid in a day or two after I used the card than only the one item would get an over draft charge. It seemed to me that they were holding off posting my weekend purchases until I was over drawn.

[LisaM]

7. Didn't this originate with Reagan, when he was governor of California?

Claimed to cut taxes, but imposed fees on everything, including college tuition, which, I understand but don't know because I wasn't college age and didn't live in California, was quite reasonable before he came along.

[unblock]

17. reagan pioneer fee-based government, but private-sector fees are courtesy of mergermania

it's the lack of competition that let's the bastards get away with this crap.

if there were a credible, genuine alternative touting honest fees or no fees altogether, they would get a ton of people switching.
as it is, people switch when they get pissed off about fees, but the competitor they switch to has similar gotcha fees. the only difference if that particular customer hasn't been burned by that particular vendor. yet.

[shraby]

10. I just got hit with a $5 fee to take off a feature

I had on my phone. Didn't know it was there until I asked them to drop the service.

[Hugin]

15. And what are the GOPpers whining about?

The same thing they've always whined about... "Get the Gooberment offa my back!"

Well, I for one, wish someone would get these Corporations off of my back.

[CabalPowered]

18. I just dropped Allstate b/c of this

They started charging a $5 processing fee for making payments at the local office. And that good driver discount.. what a load of crap. I did the math and I'd have to be a "good driver" for about 10 years before it was cheaper than Geico. And that's with a policy with twice the limits as the Allstate policy.

[KaptBunnyPants]

19. Direct TV's $29.99 basic plan costs 48 dollars a month.

4.99 per TV (2), and another 8 dollars in miscellaneous fees. It's bad enough that I have to pay Rupert Murdoch for TV, but they jack up the price over 50% higher than they advertise it at. I look forward to canceling my account when I get my next home.

[OneBlueSky]

20. what's this "groceries" fee of $2.47 per 7.5 orders per month? . . .

this is a new one for me . . . can anyone enlighten? . . . thanx . . .