Personal Finance

BMO Club Sobeys Bank Account - Grandfathered

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Aug 1, 2008
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spookstaz wrote:
Jul 13th, 2014 12:46 am
I have the BMO IGA chequing account which I think is similar to the Sobeys account. I am annoyed because BMO charges me a $1 fee every time I make a lump sum payment to my BMO mortgage from this account on the BMO website.

They are guilty of false advertising. They promised unlimited free transactions and bill payments online. Yes I know they charge you $1 to use the tellers, but can't find anywere where they state you will get charged fees when you make mortgage payments and all I am doing is entering an amount and clicking a link on their website. I've tried contacting them to complain but they say it counts as a "in-house branch service". I feel ripped off but I guess I am stuck paying a $1 fee every time.
have you tried to transfert the funds from your BMO IGA account to your mortgage account?
I feel the need... the need for speed.
Sr. Member
Apr 28, 2014
675 posts
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Oakville, ON
spookstaz wrote:
Jul 13th, 2014 12:46 am
I have the BMO IGA chequing account which I think is similar to the Sobeys account. I am annoyed because BMO charges me a $1 fee every time I make a lump sum payment to my BMO mortgage from this account on the BMO website.

They are guilty of false advertising. They promised unlimited free transactions and bill payments online. Yes I know they charge you $1 to use the tellers, but can't find anywere where they state you will get charged fees when you make mortgage payments and all I am doing is entering an amount and clicking a link on their website. I've tried contacting them to complain but they say it counts as a "in-house branch service". I feel ripped off but I guess I am stuck paying a $1 fee every time.
I've worked at BMO previously in their contact centre. The service you describe is one that has to be manually processed by someone in their back office.

That being said, you are making a payment toward their own lending product. In my mind, it should be service charge exempt. The agent you talk with on the phone is quite capable of reversing the fee; they don't seem to want to though. Have you tried escalating to a manager?

Maybe play hardball; is your mortgage open term or close to renewal? Tell them if they don't reverse those charges you will move the mortgage out. That should get them to pay attention.

You argument is this: if the mortgage was at another institution, and you wrote a cheque off your BMO account or got the other institution to put through a pre-authorized debit for a lump-sum payment, the transaction would be free. Why is BMO ripping you off by charging a $1 to make a payment toward their own lending product?
Sr. Member
Apr 28, 2014
675 posts
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Oakville, ON
Bomberman07 wrote:
Jul 13th, 2014 11:09 am
have you tried to transfert the funds from your BMO IGA account to your mortgage account?
I don't believe he can do a straight transfer. That only applies to a MasterCard or a Line of Credit. A mortgage or loan payment has to be manually processed by someone. BMO seems to be taking the position that since an employee is involved in processing the payment, it is not a self-serve transaction and is service charge eligible. However, he is paying their own lending product. They make enough money off him in interest. To charge him a $1 for a lump sum payment is nickel-and-diming, and I agree that is a bad business practice of BMO.
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Mar 25, 2012
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MehtabS wrote:
Jul 13th, 2014 8:32 am
I have option to get direct deposit or cheque. But like you said, if direct deposit is possible I would definitely go that route. About cash back limit, it doesn't really matter. I just need peace of mind that my bills will always be paid (in my credit limit) without interest and I would have 30 days to pay it back. BTW, are there any fees for all these transactions? I don't think cash advance fee will apply as long as I don't withdraw cash by atm.
No fees on deposits to credit cards; it's a lesser-utilized feature. And, assuming you have a high credit limit, "cashback" limits are irrelevant as you suggest. My suggestion to "try" direct deposit is to try having your GST/HST credit cheque deposited directly to your credit card or linking your credit card (or LOC) account number to your Tangerine or PayPal account(s) using the "penny" test. A good way to do it without, potentially, delaying your paycheque! ;)

General "rule of thumb" on cash advance-like transactions: the "Big Five" banks generally do not charge a fee for advances/transfers from (via online banking or credit card cheque) your credit card or LOC account. However, most of the credit card-only companies (other than maybe President's Choice Financial, but then that's CIBC, and maybe Wal-Mart Financial) do charge for anything that isn't a "purchase". MBNA Canada, the direct credit card issuance division of TD Bank Group, is among the "worst offenders" for this. With BMO, you should be fine in this regard.

The one "caveat", if there is one, is if you have a third party that isn't on the account deposit funds to your credit card directly (via in-branch deposit), some banks are a bit "sticky" on this and may not allow these type of transactions to take place (especially if their credit card division may lack certain cumulative cash transaction tracking like their banking division, in the case of HSBC, which is operated by their former HSBC Finance division).

Cheers,
Doug
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Mar 25, 2012
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Cerium398 wrote:
Jul 13th, 2014 2:00 pm
I don't believe he can do a straight transfer. That only applies to a MasterCard or a Line of Credit. A mortgage or loan payment has to be manually processed by someone. BMO seems to be taking the position that since an employee is involved in processing the payment, it is not a self-serve transaction and is service charge eligible. However, he is paying their own lending product. They make enough money off him in interest. To charge him a $1 for a lump sum payment is nickel-and-diming, and I agree that is a bad business practice of BMO.
Is this for a regular or a bulk payment to a mortgage? If you're trying to manually pay your regular payments, that creates a lot of overhead and "extra work" for already-streamlined bank employees. If it's a "bulk" payment, you're doing it via online channels and not via their branch network (which can be backdated to the day of or next day after the date of your request) so you're reducing the administrative burden of the branch network and onto one of their back office employees in a data processing or lending administration centre (presumably, in a place like Markham, Mississauga, Montreal, Calgary or Vancouver). I'd argue that automated, regular loan/mortgage payments (whether through the pre-authorized debit or internal automated fund transfer systems) and "bulk" payments done via online/telephone banking should be free with any package (Scotiabank offers this - you can use a Money Master Savings Account for your loan/mortgage payments and never pay a fee). :)

One thing you could do (and they're dumb to charge you a fee, in my opinion, for this reason) is go into a branch to make your "bulk" payment with a cheque drawn on your BMO account. Ask for your cheque image to be returned (so they put it through the cheque clearing system by stamping the reverse of the cheque, as opposed to using the cheque presented as an internal debit entry and stamping the front to retain it in the branch's "days work") and the entry will be show up as a free, cheque clearing transaction on your online banking within generally 12-18 hours. This actually requires more work on the already-overworked branch staff, potentially even requiring the branch employee to deposit the cheque into an internal "suspense" account and sending the mortgage payment entry on to yet another mid- or back-office employee to post. You could then casually suggest you'd prefer to do this online but BMO's back-office charges you a fee. This might ignite relative angst between the branch and back-office and potentially cause change to be implemented.

Cheers,
Doug
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Feb 25, 2014
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dmehus wrote:
Jul 13th, 2014 3:56 pm
No fees on deposits to credit cards; it's a lesser-utilized feature. And, assuming you have a high credit limit, "cashback" limits are irrelevant as you suggest. My suggestion to "try" direct deposit is to try having your GST/HST credit cheque deposited directly to your credit card or linking your credit card (or LOC) account number to your Tangerine or PayPal account(s) using the "penny" test. A good way to do it without, potentially, delaying your paycheque! ;)

General "rule of thumb" on cash advance-like transactions: the "Big Five" banks generally do not charge a fee for advances/transfers from (via online banking or credit card cheque) your credit card or LOC account. However, most of the credit card-only companies (other than maybe President's Choice Financial, but then that's CIBC, and maybe Wal-Mart Financial) do charge for anything that isn't a "purchase". MBNA Canada, the direct credit card issuance division of TD Bank Group, is among the "worst offenders" for this. With BMO, you should be fine in this regard.

The one "caveat", if there is one, is if you have a third party that isn't on the account deposit funds to your credit card directly (via in-branch deposit), some banks are a bit "sticky" on this and may not allow these type of transactions to take place (especially if their credit card division may lack certain cumulative cash transaction tracking like their banking division, in the case of HSBC, which is operated by their former HSBC Finance division).

Cheers,
Doug
Wow, thanks for detailed explanation :)
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Oct 23, 2011
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Kirkland, QC
Bomberman07 wrote:
Jul 13th, 2014 11:09 am
have you tried to transfert the funds from your BMO IGA account to your mortgage account?
No unfortunately the mortgage account is not selectable in the transfer screen. They don't let you deposit and withdraw like a chequing or savings account
Cerium398 wrote:
Jul 13th, 2014 1:56 pm
You argument is this: if the mortgage was at another institution, and you wrote a cheque off your BMO account or got the other institution to put through a pre-authorized debit for a lump-sum payment, the transaction would be free. Why is BMO ripping you off by charging a $1 to make a payment toward their own lending product?
Exactly! As far as I can tell PC Financial does not charge fees when you pay your PC mortgage from your PC chequing account. With the BMO call center agents so far I haven't gotten very far. Their solution was to reverse the charges as a one time exception and advised me not to make more lump sum payments. Unfortunately my mortgage renewal is a long ways off, I just switched to BMO for their 2.99% promo but I will still try calling my BMO mortgage agent. Thank you so much for your reply
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Feb 24, 2008
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Poutinesauce wrote:
Jul 14th, 2014 1:24 pm
I think it's better to close this account for those of you who have it, BMO is going to pull some shady stuff real soon to charge more fees as with the example seen above. I'm going to go close this now.
They can't charge anything without prior notice.

Until then, it still benefits me to keep it open.

djino
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Apr 28, 2014
675 posts
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Oakville, ON
spookstaz wrote:
Jul 14th, 2014 10:10 am
No unfortunately the morgage account is not selectable in the transfer screen. They don't let you deposit and withdraw like a chequing or savings account



Exactly! As far as I can tell PC Financial does not charge fees when you pay your PC mortgage from your PC chequing account. With the BMO call center agents so far I haven't gotten very far. Their solution was to reverse the charges as a one time exception and advised me not to make more lump sum payments. Unfortunately my mortgage renewal is a long ways off, I just switched to BMO for their 2.99% promo but I will still try calling my BMO mortgage agent. Thank you so much for your reply
So they reverse the charges as a one time exception (which means they could have done it all along and not wasted your time).

And they advise you not to make any more lump sum payments, which means you get charged more interest over time? That's their solution?

Those motherf***ers!!!

I guess your only other option to pay your mortgage faster without incurring that service charge is to go to accelerated bi-weekly payment schedule and exercise the annual option to increase your payment. I believe with the Special Fixed Low-Rate Mortgage you are limited to an additional 10%, as opposed to 15% with one of their regular mortgages.
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Oct 23, 2011
367 posts
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Kirkland, QC
Cerium398 wrote:
Jul 14th, 2014 2:29 pm
So they reverse the charges as a one time exception (which means they could have done it all along and not wasted your time).

I guess your only other option to pay your mortgage faster without incurring that service charge is to go to accelerated bi-weekly payment schedule and exercise the annual option to increase your payment. I believe with the Special Fixed Low-Rate Mortgage you are limited to an additional 10%, as opposed to 15% with one of their regular mortgages.
Yeah or make larger lump sum payments less frequently. I wanted to make an extra $500 payment every 2 weeks, but now I know I will get charged so I'll wait until the end of each month and make a larger payment. As far as I can tell these fees were not declared anywhere on their website or when I signed up for the IGA account or later (May 2014) when I signed on with them for my mortgage.

However it is still cheaper than switching to one of their monthly plan accounts.
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Feb 10, 2013
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Richmond
or create a pcf no fee banking account. transfer the funds you need to pay payments , go in branch and give them a cheque drawn on the pcf account. xd, if they are being mean, give them more work.
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Poutinesauce wrote:
Jul 14th, 2014 1:24 pm
I think it's better to close this account for those of you who have it, BMO is going to pull some shady stuff real soon to charge more fees as with the example seen above. I'm going to go close this now.
djino wrote:
Jul 14th, 2014 1:30 pm
They can't charge anything without prior notice.
+1, and it's "without sufficient notice" on top.

I doubt they will make this account worst since not too many ppl have it in the first place.
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Jul 28, 2003
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Toronto
After signing up for this in May of this year, I have yet to receive any free bonus Club Sobeys points as per the promotion for both the Chequings and Savings accounts. I have called both BMO and Club Sobeys, and they are both stating the other party is responsible for crediting me with the bonus points.

Has anyone else received their bonus points since signing up before this ended?

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