Salal Credit Union

What You Need to Know About Overdrafts

Life can be hectic, but with the right tools, you can stay on top of your finances.

 

What is an overdraft?

An overdraft occurs when transactions such as checks, debit card purchases or ATM withdrawals exceed your account balance. An overdraft can occur for many reasons. For example, many of us prefer to keep our money where it earns dividends—savings and money market—but if we forget to transfer money to checking before that mortgage payment goes out a fee can result as explained below. At our discretion, we may pay transactions that overdraw your checking account, or we may decide to return the items. Items we return are considered non-sufficient funds (NSF) items and we charge NSF fees. When we decide to pay an item which overdraws your account, we charge overdraft fees. The payment of items which causes an overdraft in your account is never guaranteed and you should not write checks or initiate any debits to your checking account if payment of those items would exceed the balance in your account. Payment of ATM and one-time debit card transactions will not be paid into overdraft unless you have expressly opted in for payment of those types of transactions.

 

Will I be notified of an overdraft?

You will receive a notice informing you if an item was not paid due to insufficient funds in your account and the amount of the NSF fee(s) you were charged, if applicable. If we pay an item which overdraws your account, you will be expected to make a deposit as soon as possible to bring your checking account to a positive balance. If your checking account remains overdrawn, we will send you notices and will close your checking account if the required deposit is not made within the timeline we specify. Checking accounts closed for this reason are reported to a consumer reporting agency and may impact your ability to obtain a checking account or any other type of deposit account.

 

In what order are my items processed?

We ordinarily process and post debits to your checking account throughout the day in the manner explained below.

  • Checks—posted nightly from lowest to highest dollar amount
  • Signature-based debit card transactions—posted daily in the order received from our network processor
  • ACH—posted daily from lowest to highest dollar amount
  • PIN-based debit card transactions—posted real time (as the transaction occurs)

 

How much will you charge me for overdrafts?

Our NSF fee is $29 per item with a daily maximum of $116, and our overdraft fee is $29 per item with a daily maximum of $116.

 

What overdraft protection can I get from Salal?

Salal’s standard overdraft services are available through:

  • Courtesy Pay Basic (for ACH transactions and checks)
  • Courtesy Pay Plus (for ACH transactions, ATM withdrawals, checks and everyday debit card transactions)

Overdraft protection is only available on eligible accounts. If you are eligible and we pay items, you will be assessed an overdraft fee as explained above.

 

How can I better monitor my account?

Salal has tools to help you manage your checking account and prevent these unnecessary fees:

Online Banking. Salal’s free Online Banking makes it possible for you to monitor your accounts as often as you like from anywhere you have an Internet connection. Not only can you better avoid NSFs or overdrafts by having a clearer idea of the balance remaining in your account, you can also keep an eye out for suspicious activity that may indicate fraud. You may sign up for Online Banking by calling us at 800.562.5515 or 206.298.9394.

Alerts. Available in Salal’s Online Banking, alerts notify you when your account balance dips below an amount you’ve specified. In Bill Pay, “eNotifications” and “Reminders” notify you of payments and transfers so you are aware of how much money remains in your account.

BALANCE. This financial fitness program offers free, confidential counseling on money matters to all Salal members. Get help budgeting, understanding credit, saving for a down payment, or finding ways out of debt. From our website, salalcu.org, click “Personal,” then “FINANCIAL EDUCATION.”

 

Is a checking account right for me?

For some, a checking account may be more of a concern than a convenience. If you’re paying frequent NSF and overdraft fees, perhaps another option would work better for you.

 

Is there a less costly option if my account becomes overdrawn?

Salal offers Overdraft Transfer Protection. This service allows you to designate other Salal accounts (savings, credit card, line of credit, money market) from which to transfer funds if there’s not enough in your checking to cover payment of items. Fees for this service vary; call 800.562.5515 for details. A fee is assessed for each transfer.

 

What are some other ways I can pay besides using my checking account?

We recommend money orders and cashier’s checks. Unlike regular checks, where the money isn’t debited from your account until the check is deposited by the payee, money orders and cashier’s checks must be purchased from the credit union in the amount you need. This can reduce confusion over how much money is left in your account. While money orders and cashier’s checks come with a small fee, they are less expensive than overdraft or NSF fees. Savings account and ATM card. With a Salal savings account, you can earn dividends while still retaining access to your funds, via our ATMs. You can also use your savings account to purchase money orders and cashier’s checks.