Add “Bank Account” to Your Dorm Shopping List

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We support reforms to the financial marketplace that protect consumers from unscrupulous banks and lenders.

By Consumers Union on Tuesday, August 21st, 2012

A large number of college students are gearing up to start their fall sessions, and many likely have Higher One cards, given that the company has contracted with over 500 campuses nationwide to distribute financial aid monies.  These same students (and their parents) should know that last week, Higher One and Bancorp Bank (Higher One’s former bank) were ordered by the FDIC to pay back some of its customers, and correct its practices.

So, what should a money-savvy student do?  Do your homework on which account works best for you.

Here are some great tips offered by the CFPB:

  • You can’t be required to use a specific bank or card. There may be a financial institution that operates on your campus, but you generally can’t be required to use a specific account or card to access your student aid. If you have received a federal student loan, your school must provide a paper check or cash option.
  • Consider choosing an account before arriving at school. Shop around, and don’t feel limited by the banks operating ATMs on or near campus. Some financial institutions don’t charge you for using any ATMs, and some will automatically reimburse you for fees charged for using an out-of-network ATM. Many institutions also provide a mobile phone app to remotely deposit paper checks.
  • If your school offers it, sign up for direct deposit as soon as possible. If your school offers direct deposit, you may be able to provide the school with your account information in order to access your funds more quickly.

We also want to take this opportunity to highlight some of our own tips for students on where to put their money.

This is not the first time Higher One has been involved in controversy.  See our previous blog on concerns raised by college students regarding its fees.

 

 

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