Why was I charged an overdraft fee?

Asked by: Charlene O'Kon DVM  |  Last update: November 26, 2025
Score: 4.6/5 (25 votes)

An overdraft fee can be triggered when a transaction, withdrawal or transfer causes your account balance to go negative. It can also be charged if your account is already negative when a transaction is debited. Although some banks don't actually charge them, overdraft fees can be costly.

Why did I get charged an overdraft fee?

An overdraft fee is a charge you incur from your bank when you spend more money than you have available in your bank account, usually your checking account.

How do I stop my bank from charging my overdraft fees?

You can contact your bank to find out how to revoke consent. Your decision to revoke your consent does not require that the bank waive or reverse any overdraft fees already assessed on your account, but it will prevent any future fees for one-time debit card transaction overdrafts.

Can I claim back my overdraft charges?

You can make an affordability complaint and ask for a refund of overdraft charges if: your overdraft limit was set too high at the start or increased to a level you are unable to clear; or. your overdraft usage showed you were in long-term financial distress.

Can I refuse to pay overdraft fees?

If you overdraft your bank account and don't pay what you owe plus the overdraft fee, you could face several unpleasant consequences, such as owing additional fees, your account being closed, and having the debt go to collections.

Why Was I Charged an Overdraft Fee? | #AskPelican

22 related questions found

How do I get rid of overdraft fees?

How You Can Try to Get Your Overdraft Fee Waived
  1. Call your bank. Contact your bank as soon as you realize you've been charged an overdraft fee. ...
  2. Explain what happened. ...
  3. Provide a timeline. ...
  4. Point out your history as a customer. ...
  5. Always be polite. ...
  6. Get a second opinion. ...
  7. As a last resort, try this.

What happens if you never pay overdraft?

Not paying back your arranged overdraft may lead to large interest charges. If you can't pay it back, your provider may withdraw your arranged overdraft and ask for full repayment. This could also affect your credit score. If you're struggling to pay off your Lloyds Bank overdraft, then we may be able to help you.

Can I dispute an overdraft fee?

If you need an overdraft fee refund, you can request one from your bank. However, while they may be happy to help you once or twice, you should always try to avoid an overdrawn account. Of course, life can happen and an overdrawn account may happen.

How to get rid of an overdraft?

Getting out of my overdraft – where do I start?
  1. Stop using your overdraft if you can. Stop using it if you do not need it to survive. ...
  2. Create (or review) your budget. Work out what your income and spending is. ...
  3. Speak to the people you owe. They could agree to reduce your overdraft limit over time.

Do banks overturn overdraft fees?

Banks decide individually whether an overdraft fee can be refunded, but common reasons include bank errors, first-time offenses, or personal financial reasons.

How long can an account be overdrawn?

Answer: 24-Hour Grace gives you until midnight Central Time the day after you overdraw your account, or have eligible returns to make a deposit to bring your account balance positive, including new transactions from that day (such as debit card transactions, written checks, and scheduled automatic payments) plus the ...

What is the new overdraft fee law?

Several new laws go into effect on Wednesday — and one of them could impact your wallet. The law will prevent state-chartered banks from charging fees for withdrawals that are immediately declined, including for insufficient funds.

How do I clear my overdraft balance?

Transfer the amount you owe on your overdraft to a personal loan that will allow you to repay the debt over time on a reduced interest rate. Set up a repayment plan of staged reductions in the overdraft limit (and balance)

How do I convince my bank to refund overdraft fees?

The best way to try to get your overdraft fee refunded is to call your bank or credit union and speak to a customer service representative. While they don't have to approve your request, you may be able to persuade them by explaining how your account balance managed to cross into the red.

Can you go to jail for an overdrawn bank account?

No, you won't go to jail for simply having a negative bank account balance. Overdrafting your account is a common issue many people face.

Why am I being charged overdraft interest?

When your bank account is overdrawn, you pay interest each calendar day on the amount you owe. The annual interest rate for overdraft protection is usually around 21-22%. Remember that interest charges are only part of the cost of using overdraft. Pay-per-use fees can significantly increase your total banking costs.

Can a bank just cancel your overdraft?

They might do this if you keep going over your agreed limit. You should contact your bank if they tell you they're going to restrict or remove your overdraft. You should explain your situation and tell them why you're struggling to pay off your overdraft.

Does overdraft affect credit score?

An arranged overdraft is unlikely to have a major impact on your credit score as long as you don't go beyond your overdraft limit or have payments refused. In fact, if you use your overdraft sensibly and regularly pay it off it could improve your credit rating.

How do I stop my card from overdrafting?

  1. Opt out of overdraft coverage.
  2. Watch your account balances regularly.
  3. Set up alerts for low balances.
  4. Deposit or transfer money quickly when an overdraft occurs.
  5. Link to another account.
  6. Get a prepaid debit card.
  7. Look for a bank with a generous overdraft policy.
  8. Glossary of overdraft terms.

Can overdraft fees affect your credit?

Overdrafts don't usually affect your credit scores unless you don't resolve them quickly and the account goes into collections. Checking accounts aren't included in your credit reports from the three major credit bureaus, but they could be included in your ChexSystems report.

Why is my bank charging me a daily overdraft fee?

Financial institutions charge overdraft fees for the service of paying for a transaction that costs more than the amount of funds available in an account; in other words, the bank is loaning you money without charging interest. Sometimes an overdraft fee is called a “courtesy pay” fee.

How do I remove an overdraft from my account?

Submit closure request: Visit your bank branch or use the online banking portal to submit a formal request for closing the overdraft facility. Ensure you have all necessary documents, such as the final statement and a request letter.

What happens if you refuse to pay an overdraft fee?

Overdraft fees that are not paid can be reported to credit bureaus, which can negatively impact your credit score. It can be difficult to obtain new credit, as banks and lenders may view you as a high-risk borrower. This will also likely result in increased interest rates on future loans or credit cards.

How to get out of overdraft fees?

Getting overdraft fees refunded is only a phone call or email away. Contacting customer service and requesting a waiver is both the simplest and most effective way of waiving expensive overdraft fees.

Do banks forgive overdraft?

Yes. If you have met the criteria before the Overdraft Fee Forgiven period ends, the charged Overdraft Paid Fee(s) will be systematically waived.